Is Indian home-grown automotive sector maturing fast ? The case of Tata and Mahindra ..

Indigenous automobile production from the idea conception, design, prototyping,  manufacturing and withdrawal stage in the country happens only with two major manufacturers, Tata Motors and Mahindra.

Jamshedji Tata will be proud of his great grandson, Ratan

Of these we find Tata Motors has been moving at a pretty fast pace. starting from the Tata Indica model which is still very popular because of its low maintenance costs to Tata Nano, the compact low cost model with for the first time in the world, under the rear seat 660 cc petrol engine to different SUVs and LCVs etc.. Tata's acquisition of Jaguar Land Rover (JLR) from UK spearheaded by the former visionary Tata Group Chairman Ratan Tata, was the game changer for Tata, as after that we have found there has been no looking back for Tata Motors. (Click here for the June '16 writeup in Telegraph UK of Jaguar revival). Even though like every automobile manufacturer, they have had their regular ups and downs occasionally, the year 2017 looks very promising.

During the past one or two years, Tata has released Zest, Tiago models which are quite popular and is helping Tata slowly push itself to the list of global automobile manufacturers in a big way. The expert way in which Tata Motors helped guide its acquisition of the British Jaguar LandRover to move from heavy losses to heavy profits in a matter of 3-4 years is a phenomenal turnaround story every business school should discuss and every business student of the world should be made  aware of.

The 2017 Jaguar XE, from Tata Motors

Tata's managerial style of delegating the operational management and operational decision making of JLR to local British managers, with only higher level financial decision making with Indian managers ensured minimum interference in the company's operations. Financial decision making was in the control of Tata Managers. Just the profits of JLR in 2012 was equivalent to what Tata Motors paid to buyout JLR from Ford in 2008, British Pounds 1.5 billion.

JLR has been doing exceedingly well, as a showcase of superior Tata management style. On the financial side, in 2016, they had revenues of almost BP 22.2 billion, with production of 500,000 vehicles annually, about 70% being in the diesel range. The Chinese economic slowdown of  late and the British revival has seen Juguar making a comeback in its land of origin. Tata's Kite 5 to be released in March '17 is definitely going to make heads turn around both in terms of stylish design, costs and utlity.

2016 model of Jaguar XE

Mahindra has also been doing well , its acquisition of the Bangalore based electric car manufactyrer, Reva has helped it to broaden its range and offer diverse models with an aim to grab a good portion of Indian sales and global sales.

Even though the Indian automobile industry has turned truly global with all major global automobile manufacturers in the country, from Toyota to VW, Renault, Ford, GM, BMW, Audi, Nissan, Honda, Suzuki, Hyundai, Mercedes Benz doing local manufacturing and assembly, it has been a tough task for the local players like Tata and Mahindra to make great cars and outperform competition both in terms of performance and costs.

The to-be-released Tata Kite 5 sedan model ..

As India slowly moves to become the world's largest economy by 2040 AD and dominate global manufacturing and economic growth, we expect global manufacturing to shift to India and Indian companies to outperform western, Japanese and Korean automobile manufacturers.

As throughout history India has been dominating both the intellectual and materialistic world over more than 8000 years and being one of the two oldest civilizations on planet earth, it's control and dominance over the rest of the world in the modern digital, manufacturing and knowledge age is not too far either !

george..