India’s Tata Motors was moving forward with a strategy focused on small inexpensive cars, even though this was a highly competitive market segment, dominated by Japanese auto makers. The company’s aim was to design a small car that would be significantly cheaper to make and buy than any other model, and thus to satisfy India’s mass market demand for low – cost transportation. The result was the Nano, with a sales price of 100, 000 rupees (US$2,500), which was half the price of its closest competitor in India. Tata Motors achieved this by designing everything from scratch, deleting features that were taken for granted by other auto makers (for example air conditioning, power brakes, radios), using lightweight steel and an aluminium engine, and building in fuel efficiency. Being the part of such a large TATA group is itself a competitive advantage. This affiliation provides the company with the needed knowledge and technology resources for taking their business to various parts of the world. Geographic Location Being active and dynamic, TATA motors has competitive advantage for being located in India for the low cost labor base. Innovation and R&D The excellent innovation and research and development at TATA motors have created examples for the rivals. The company has come up with the least expensive car model NANO which is one of its own kind and no other car manufacturer has ever created such. Mergers and Acquisitions: Continuous growth and expansion is the company goal. TATA has successfully acquired various companies for breaking into the foreign markets. While the company has delivered amazing results in domestic market, its subsidiary Jaguar land rover has broken all the records of competitors as a top luxury automobile manufacturer. Effective HR Management The people strategy is lean and strong since ever. TATA has a very strong workforce base however it has cut off the surplus staff recently in June 2017 as a part of organization restructuring and gaining a competitive advantage. Product Development TATA aims to fulfill the emerging needs of the automobile industry by coming up with new range of products. These products are manufactured with purpose of providing comfort, reliability, safety, capacity and value to the end customers. In order to stay ahead of the competition, the company is going for huge investments in the area of product development. Question Describe the market that Tata was focused on and compare and contrast the competitive advantage of Tata Motors with that of U.S. car producers as highlighted in the case.
India’s Tata Motors was moving forward with a strategy focused on small inexpensive cars, even though this was a highly competitive market segment, dominated by Japanese auto makers. The company’s aim was to design a small car that would be significantly cheaper to make and buy than any other model, and thus to satisfy India’s mass market demand for low – cost transportation. The result was the Nano, with a sales price of 100, 000 rupees (US$2,500), which was half the price of its closest competitor in India. Tata Motors achieved this by designing everything from scratch, deleting features that were taken for granted by other auto makers (for example air conditioning, power brakes, radios), using lightweight steel and an aluminium engine, and building in fuel efficiency.
Being the part of such a large TATA group is itself a competitive advantage. This affiliation provides the company with the needed knowledge and technology resources for taking their business to various parts of the world.
Geographic Location
Being active and dynamic, TATA motors has competitive advantage for being located in India for the low cost labor base.
Innovation and R&D
The excellent innovation and research and development at TATA motors have created examples for the rivals. The company has come up with the least expensive car model NANO which is one of its own kind and no other car manufacturer has ever created such.
Mergers and Acquisitions:
Continuous growth and expansion is the company goal. TATA has successfully acquired various companies for breaking into the foreign markets. While the company has delivered amazing results in domestic market, its subsidiary Jaguar land rover has broken all the records of competitors as a top luxury automobile manufacturer.
Effective HR Management
The people strategy is lean and strong since ever. TATA has a very strong workforce base however it has cut off the surplus staff recently in June 2017 as a part of organization restructuring and gaining a competitive advantage.
Product Development
TATA aims to fulfill the emerging needs of the automobile industry by coming up with new range of products. These products are manufactured with purpose of providing comfort, reliability, safety, capacity and value to the end customers. In order to stay ahead of the competition, the company is going for huge investments in the area of product development.
Question
Describe the market that Tata was focused on and compare and contrast the competitive advantage of Tata Motors with that of U.S. car producers as highlighted in the case.
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