Tata Motors to triple sales network, fill gaps in portfolio

Tata Motors has lined up a slew of initiatives, including the tripling of its sales network, filling the gaps in its product portfolio, improving manufacturing processes and brand image, as part of its strategy to be one of the leading players in the Indian passenger vehicle segment.

The company is also introducing measures to cut costs at all levels in the organisation and at the same time, working on improving manufacturing quality as well as workforce efficiency at multiple levels.

“We are looking at customer satisfaction and that also includes sales network expansion. Other initiatives include a reduction in costs, improving product quality, enhancing brand image and filling the gaps in the product portfolio,” Tata Motors President for passenger vehicle business, Mayank Pareek told PTI.

Triple sales network in four years

As part of its strategy to be present in every nook and corner of the country, the company plans to triple its sales network in the next four years.

“At the end of last fiscal, we had a total of 500 dealerships. We aim to triple that to 1,500 outlets in the next four years. This is an audacious target we have set as India is a vast country. You need to be near the customer,” Pareek said.

The company plans to open as many as 200 outlets in the current fiscal, of which it has opened 81 new dealerships in April-September.

“We want to be widely spread out and deeply penetrated.

In the next five years, 50% of the demand would come from towns having less than 50,000 population. To address this market, you need to spread out,” Pareek said.

Two new products every year till 2020

Tata Motors, which plans to launch two new products each year till 2020, is also looking to bolster its product portfolio by filling in gaps by introducing various models.

“We have lots of gaps in our portfolio. Naturally, these have to be filled. We have a road map to fill these gaps.

Going forward, you will see two new products from us every year,” Pareek said.

Asked if the company plans to launch a compact sports utility vehicle (SUV), he added: “That is growing (compact SUV segment). We will have a compact SUV. In the SUV segment, we really need to strengthen our portfolio. The segment is growing and is around 20% of the market. Our products need to be refurbished.”

Pareek also hinted at introducing a bigger SUV. The company already sells Safari in this segment.

The Mumbai-based firm is also looking to enhance its brand appeal by bringing in the “cool” quotient to connect with youngsters and the signing of soccer superstar Lionel Messi as the company’s brand ambassador is “a step in that direction”, Pareek said.

“According to a research, when a person wants a buy a car, he evaluates 2.6 cars in his mind. If you are not in that 2.6, you need to spend a lot of money… Our dream is that five years later if anybody wants to buy a car in India, one of the cars he must consider should be a Tata Motors one.”

Commenting on sales, Pareek said the company grew 14.8% in April-September while the industry grew at around 6.5% compared with the same period of the previous fiscal. “With new car launches, we should be able to outperform the industry,” he added.

Furthermore, as part of its customer-centric approach, the company is looking to enhance dealer as well as customer satisfaction. “As the dealer is the company’s first customer, we are trying to improve processes at their end. We are improving and upgrading infrastructure at dealerships, which would lead to better performance,” Pareek said.

Besides, the company is focusing on an effective complaint resolution mechanism and improving diagnostic skills of the servicing staff. It is working on a host of internal issues, including cost reduction at all levels.

“We are working on having a robust cost structure, cost is very important. We are doing big projects on cutting costs so that we become extremely a cost-efficient firm,” Pareek said.

The company is also planning to improve its manufacturing processes by introducing various new techniques and has also taken cues from Jaguar Land Rover to improve quality issues, he added.

The company, which made a comeback of sorts with compact sedan Zest and hatchback Bolt, is all set to bolster its entry-level portfolio with the launch of an all-new model Zica.

“Zica is a very important milestone in our journey. I call it a journey towards transformation,” Pareek said about the upcoming model.
The small car is based on an all-new platform and would come with completely new petrol and diesel engines. The company expects it to enhance its presence in the entry-level segment.

Tata Motors had fallen behind the likes of Honda, Toyota and Mahindra & Mahindra in the Indian passenger vehicles market from being the third-largest player at one point as its products, including the Nano, failed to deliver.

It is banking on new products to revive its fortunes.