Tata Motors Strategy Case Study
Key Learning Outcomes
By the end of the case, students should be able to:
- Analyse the Indian automobile industry and how the five forces have affected the fourth biggest vehicle manufacturer in India-Tata Motors, and rivals and the impact on industry structure, attractiveness, and profitability.
- Understand how Tata Motors has managed to defend against intense competition from Maruti Suzuki, Hyundai, Mahindra etc. and the strategies it uses to create 'blue oceans' that are defensible, helping it capture and maintain competitive advantage.
- To apply strategy business models and frameworks such as Porters five forces to real company cases.
Analyse Tata Motors through the lens of Porters five forces to assess how the five forces affect the Tata Motors industry and automobile industry in India.
- See also, Tata Motors Pestle & Swot Analysis 2018
1.0 INTRODUCTION
Tata Motors limited is an Indian multinational automobile manufacturer established in 1945 in India. The company is part of the $100billion Tata group and one of the largest automobile companies in India. As the world’s largest truck manufacturer and the fourth largest bus manufacture (Car Wale 2018), Tata Motors operates in UK, South Africa, South Korea, and Thailand and has a global network of 76 subsidiaries and associate companies including Tata Daewoo in South Korea and Jaguar Land Rover in UK. Tata is India’s market leader in commercial cars and among the top in passenger cars with approximately nine million vehicles only in India. With its designs and R&D centers in UK, South Korea and India, the company has its presence in approximately 175 countries and owns approximately 6,600 sales and service points (Tata Motors 2018). The company’s revenue as of 2017 was $41million increasing from $40 million in 2016 while its profit margin grew form 4.57% in 2016 to 3.45% in 2017 (Orbis 2017). Tata Motors commands 5.3% market shares of the Indian automobile industry after Suzuki with 49.7% ,Hyundai Kia with 16.4%, Mahindra with 6.9% and Honda at 5.6% as of 2017(Statista 2017).