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    Tata Motors Portors Five Forces Model

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    Pranav Dagar
    Tata Motors faces high internal rivalry in the domestic Indian market which is dominated by Maruti Suzuki and Hyundai. This intense competition has resulted in a loss of market share and declining turnover for Tata Motors. While there are few substitute products, suppliers have high bargaining power due to increasing demand from manufacturers setting up in India, affecting Tata's margins. Barriers to entry in the automobile industry are medium to high due to the large investments and scale required to compete with incumbents like Tata Motors.

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    Tata Motors Portors Five Forces Model

    Uploaded by

    Pranav Dagar
    3K views1 page
    Tata Motors faces high internal rivalry in the domestic Indian market which is dominated by Maruti Suzuki and Hyundai. This intense competition has resulted in a loss of market share and declining turnover for Tata Motors. While there are few substitute products, suppliers have high bargaining power due to increasing demand from manufacturers setting up in India, affecting Tata's margins. Barriers to entry in the automobile industry are medium to high due to the large investments and scale required to compete with incumbents like Tata Motors.

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    Tata Motors Portors five forces model

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    Tata Motors faces high internal rivalry in the domestic Indian market which is dominated by Maruti Suzuki and Hyundai. This intense competition has resulted in a loss of market share and declining turnover for Tata Motors. While there are few substitute products, suppliers have high bargaining power due to increasing demand from manufacturers setting up in India, affecting Tata's margins. Barriers to entry in the automobile industry are medium to high due to the large investments and scale required to compete with incumbents like Tata Motors.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    3K views1 page

    Tata Motors Portors Five Forces Model

    Uploaded by

    Pranav Dagar
    Tata Motors faces high internal rivalry in the domestic Indian market which is dominated by Maruti Suzuki and Hyundai. This intense competition has resulted in a loss of market share and declining turnover for Tata Motors. While there are few substitute products, suppliers have high bargaining power due to increasing demand from manufacturers setting up in India, affecting Tata's margins. Barriers to entry in the automobile industry are medium to high due to the large investments and scale required to compete with incumbents like Tata Motors.

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    Tata Motors Limited: Porter Five Forces Model

    Bargaining power of the customers (LOW)

    Due to the rising competition in the Indian market, the bargaining power of the customers is high
    because the switching costs are very low. Tata Motors has been facing intense competition from
    Maruti Suzuki and other new entrants like Volvo. Due to its differentiation and innovativeness
    Tata Motors has managed to compete in the industry and maintain its margins.

    Bargaining power of supplier (LOW)

    With the increasing number of manufacturers setting up shop in India, the demand on OEM
    manufactures who supply the automobile industry has increased. Thus the bargaining power of
    the supplier in the industry is very high which has affected the margins of manufacturers like
    Tata Motors.

    Threat of substitute (HIGH)

    There are very few substitutes available for the products that are produced in the industry in
    which Tata Motors operates. The very few substitutes that are available are also produced by low
    profit earning industries. This means that there is no ceiling on the maximum profit that firms
    can earn in the industry in which Tata Motors operates. All of these factors make the threat of
    substitute products a weaker force within the industry.

    Internal Rivalry (HIGH)

    Tata Motors if faced with fierce competition in the domestic market dominated by Maruti Suzuki
    and Hyundai Motors. The company is also facing competition in its commercial vehicle segment
    from Volvo and Daimler who have also started manufacturing trucks. This has resulted into a
    loss of market shares and a decline in its turnover.

    Threat of new entry (MEDIUM/HIGH)

    In the automobile industry, barriers to entry are very high considering the fact that incumbents
    like Tata Motors have already reached high scales of production which will be very expensive
    for new entrants to match. Barriers to entry into this industry are high due to the very high
    investment required for entry. Not forgetting that incumbents have gained experience with time
    and know how to operate efficiently which gives them an added advantage.

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