MINDROVER 3.

0
Team Name- KUNG FU PANDA
TEAM MEMBERS- ABHISHEK TWARI
DHIRAJ KUMAR
College- Masters in International Business

INDUSTRIAL ANAYSIS
Global commercial vehicle market
DEVELOPMENT OF COMMERCIAL VEHICLE MARKET
30,000
There is clear
growth in
demand for
commercial
vehicles in
emerging
markets.

25,000
20,000
UNITS SOLD (in million)

15,000
10,000
5,000
0
TIME LINE

RoW
East Europe
South America
West Europe
North America
Asia

INDUSTRIAL ANAYSIS
GLOBAL |
Vehicle production by region
M&HCV PRODUCTION VOLUMES 2012 (THOUSAND UNITS)
South America

32

16

Eastern Europe

Weatern Europe

Volvo
Dongfeng

6% 5%

94
134

14%

18
8

80

2
1
3

50

151

193

1
46

175
134
60

24

18%

92

62

|365 | 168 | 281 | 157 | 155 | 140 | 123

| 51 |
UNITS PRODUCED IN 2008

24%

33%

2012

Asia
pacific
China
North
America
Western
Europe
Eastern
Europe
South
america

INDUSTRIAL ANAYSIS
Factors affecting commercial vehicle industry
In the Asian
pacific region
CV industry
enjoyed a 7%
CAGR since
2008.

Demand shift
to emerging
markets

Savvy supplychain will be

vital in the
coming years
for CV
companies.
Oversupply &
stock-outs

After experiencing a
growth of over 30%
during 2009-10 and
2010-11, the
buoyancy in
domestic CV
industry has been
on a wane since
then

Continuous
market
cyclicality

Pressure on
total cost of
ownership

Overcoming
the
environmenta
l challenge

OEMs in emerging
markets have to
carefully manage
rising development
and production cost
while ensuring the
reliability of their
vehicles.

Companies are
embracing engine
downsizing,better
aftertreatment of
exhaust, use of lighter
materials, improved
aerodynamic designs.

INDUSTRIAL ANAYSIS
GLOBAL | Key Leaders

INDUSTRIAL ANAYSIS
GLOBAL | Key Leaders

INDUSTRIAL ANAYSIS
Factors | shift of demand

EM are prone to
cycles in CV
market, unlike in
triad markets the
overall growth
trend is upwards.
OEMs in EM must
prepare for
continuous growth
in capacity.

INDUSTRIAL ANAYSIS
FACTORS | cyclicality

Dependency on
overall
economic
development :
commercial
vehicle sales
usually trail
behind changes
in GDP.

INDUSTRIAL ANAYSIS
M&HCV SEGMENT

STRENGTH
Diverse product/customer centered
product
Market leader
Brand Association

WEAKNESS
Limited customer base
Lesser modification
Lower adaptability to market

SWOT ANALYSIS
OPPORTUNITIES
Export to other emerging markets.
M&A options available
Eco-friendly products.

THREATS
Rising oil prices
Weak investment sentiments.
Slowing industrial activity
Entry of global players

INDUSTRIAL ANAYSIS
M&HCV SEGMENT

Truck Market: Percentage split by M&HCV segment, India, 2012

haulage
Tippers
Tractor Trailers Tankers

15%
28%

Factors affecting
Demand.

5%

53%

Rural and urban

infrastructure
development:
RIDF(14000
Cr);JNRUM(4800 Cr)
Capacity addition
ports/ inland
waterways/refinerie
s/ cement/steel
Growing demand for
oil & gas.
Increase in
mining/power/oil
sector

INDUSTRIAL ANAYSIS
M&HCV SEGMENT

Total Industry Market in 2012-13

(164295 units)
Tata Motors
Eicher

Ashoka Leylands
Others

15
10
5

7%
5%
28%

Growth over the years 2007-2013

61%

Tata Motors Eicher

-5

Growth
over the
years
20072013

INDUSTRIAL ANAYSIS
M&HCV SEGMENT

PRODU
CT

PROMOTIO
N

Promoted as investor
friendly
Tyre insurance for
10-tyre trucks.
Easy insurance by
tying up with banks.

Regionalized
technology and
product
management
Standardize
component
manufacturing PRICE
giving a cool look Expansion of
the Value chain.

4P
s

PLACIN
G

Improve distribution
channel
Business unit wise

Recommendations for the

M&HCV Segment
Pricing

Promotion

In order to fight stiff

Competition, Economic
slowdown & to generate more
profit margin TATA Motors has
to slash prices. It can do this
by Excess Staff cutting through
VRS
By hiring more contractual
managers and labors
By hiring more diploma
holders than engineers which
have high CTC

As the demand for

M&HCV is fluctuating so
TATA Motors needs to
export more to the
developing countries
Promote the message of
TATA Motors trucks to be
Drivers Friendly through
TV ads and Radios by
introducing some
additional features

INDUSTRIAL ANAYSIS
LCV & ICV TRUCK SEGMENT
SWOT of both LCV & ICV truck
segment
STRENGTH
Diverse product/customer centered
product
Products considered as Sturdier &
Reliable
Brand Association

WEAKNESS
Limited customer base
Lesser modification
Lower adaptability to market

SWOT ANALYSIS
OPPORTUNITIES
Export to other emerging markets.
M&A options available
Eco-friendly products
Penetration into the Southern
Market

THREATS
Rising oil prices
Weak investment sentiments.
Slowing industrial activity
Entry of global players

INDUSTRIAL ANAYSIS
LCV TRUCK SEGMENT

Total Industry Market in 2012-13

(38891 units)
Tata Motors
Eicher

Mahindra & Mahindra

Others

Growth over the years 2007-2013

10
8
6

13%

8%

4
2

11%
68%

0
-2
-4

Growth
over the
years
2007-2013

INDUSTRIAL ANAYSIS
ICV TRUCK SEGMENT

Total Industry Market in 2012-13

(57416 units)
Tata Motors
Eicher

Ashoka Leylands
Others

6%
42%

40%
11%

Growth over the years 2007-2013

50
45
40
35
30
25
20
15
10
5
0

Growth
over the
years
2007-2013

INDUSTRIAL ANAYSIS
LCV & ICV TRUCK SEGMENT

PRODU
CT

Strategies for both

LCV & ICV truck
Segment

PROMOTIO
N

Regionalized
technology and
product
management
Standardize
component
manufacturing PRICE
giving a cool look Reducing cost
by
Cutting Staff
By providing
VRS to Staff

4P
s

Promoted as investor
friendly
Export promotion in
major developing
countries
Promote it as a
driver friendly truck
Easy insurance to
PLACIN
G
FTUs

Improve distribution
channel
Business unit wise

INDUSTRIAL ANAYSIS
SCV CARGO SEGMENT
SCV Cargo
Segment
STRENGTH
Diverse product/customer centered product
Market leader
Brand Association
First Mover advantage
Provides 5Ss (Stability, Safety, Speed, Space, Style)

WEAKNESS
Limited customer base
Lesser modification
Comfortableness of driver is low
Lower adaptability to market

SWOT ANALYSIS

OPPORTUNITIES
Export to other emerging markets
Rural Penetration
Growing demand for LMPTs
FTUs increasing
M&A options available
Retail Sector growth is a booster

THREATS
Rising oil prices
Weak investment sentiments.
Slowing industrial activity
Rising Competition both nationally & Internationally

INDUSTRIAL ANAYSIS
SCV CARGO SEGMENT
SCV Cargo
Segment

Total Industry Market in 2012-13

Tata Motors
Mahindra & mahindra

Ashoka Leylands
Others

2%
32%
58%
8%

Growth over the years 2007-2013

70
60
50
40
30
20
10
0

Growth
over the
years
20072013

INDUSTRIAL ANAYSIS
SCV CARGO SEGMENT
SCV Cargo
Segment

PROMOTIO
N

PRODU
CT

Provide ACs in driver

cabin(TATA Ace)
Foldable seats for
sleeping purpose

4P
s

Promoted as investor
friendly
Needs more
advertising, promote it
as a cheapest segment
Easy insurance by tying
up with local dealers
Create awareness
among people to
PLACIN
convert from drivers to G
owners to

PRICE

Cut Cost by
employing more
diploma holders
than B-Tech/BE
OR
Provide more
facilities on the
existing
Efficient use the Hub Cost.
Spoke Model
Provide Full range

Recommendations in Promotion of
SCVs
Promote drivers & FTUs to be
entrepreneurs by proving them easy
insurance
With opening up of big retails brands
such as TESCO and Wal-Mart, the use
of SCVs will increase
Come-up with a Vehicle in this
segment and promote it as the
cheapest SCVs for the poor in India

Recommendations- Value
Product
PRIMARY RESEARCH- Drivers preference
AC should be provided in TATA Ace cabin , the
primary research showed that drivers now
prefer to have the comfort while driving
Especially in a county like India where the
temp are too high during summers.

Comfo
rt
ability

Performa
nce

Today
s
Driver
Needs

Reliabili
ty

Safety

Another comfort ability factor they

demanded were a proper place to rest/
Sleep which can be in the form of
foldable seats.

With the competitors

already marching ahead in
this segment TATA Motors
need to come up with a
product which would
satisfy the needs of the
customer

INDUSTRIAL ANAYSIS
SCV PASSENGER SEGMENT
SCV Passenger
Segment
STRENGTH
Better comfort ability than 3Ws segment
Market leader
Brand Association
First Mover advantage
Provides 5Ss (Stability, Safety, Speed, Space,
Style)

WEAKNESS
Limited Product availability
Lesser modification
Challenging established market of the 3Ws
Segment

SWOT ANALYSIS
OPPORTUNITIES
Export to other emerging markets
Rural Penetration
Growing demand for LMPTs
Increasing demand for public transportation
Collaborate with Schools to provide VANs by
modifying the safety elements

THREATS
Rising oil prices
Weak investment sentiments.
Slowing industrial activity
Rising Competition both nationally &
Internationally

INDUSTRIAL ANAYSIS
SCV PASSENGER SEGMENT
SCV Passenger
Segment

Total Industry Market in 2012-13

Tata Motors
Others

Mahindra & mahindra

19%

1%

80%

Growth over the years 2007-2013

180
160
140
120
100
80
60
40
20
0
-20

Growth
over the
years
20072013

INDUSTRIAL ANAYSIS
SCV PASSENGER SEGMENT
SCV Passenger
Segment

PRODU
CT

Provide ACs PTU (can

be applied to all
countries belonging
to the Torrid Zone

PROMOTIO
N

4P
s

Promoted as investor
friendly
Needs more advertising,
promote it as a cheapest
segment
Promotion of it as a best
PTU for both
Upper & Middle Class - ACs
Lower Middle Class NonACs
PLACIN
Create awareness among G
people to covert from

PRICE

Cut Cost by
employing more
diploma holders
than B-Tech/BE
OR
Provide more
facilities on the
existing
Efficient use the Hub Spoke
Cost.
Model
Provide Full range

SCV passenger segment Our Strategy(Primary

Research)
Sample Size 100 people from diverse backgrounds ,
Location Near Metro Stations & Bus Stands of New Delhi
Would you prefer PTUs
like AC Tata Magic / Iris/
Vans than Conventional
Non-AC vehicles
i.e Shell out extra money
for the same

YES
69%

NO
27%

Don
t
Kno
w
4%

Change in the taste of the customer- People now prefer comfort

ability factor more than the price
The strategy is best suited for the metro cities in the initial phase

INDUSTRIAL ANAYSIS
LCV, ICV & MCV BUS SEGMENT

STRENGTH
Market leader
Brand Association
High Capita

WEAKNESS
Limited Product availability
Products not competitive against
competitors

SWOT ANALYSIS

OPPORTUNITIES
Government tender
Help Government as CSR to promote PTS

THREATS
Rising oil prices
Weak investment sentiments.
Slowing industrial activity
Rising Competition both nationally &
Internationally

INDUSTRIAL ANAYSIS
LCV BUS SEGMENT

LCV Buses
Total Industry Market in 2012-13
(40429 units)
Tata Motors
Eicher

Force Motors
Others

Growth over the years 2007-2013

30
25
20

7%
29%
11%

15

53%

10
5
0

Growth
over the
years
20072013

INDUSTRIAL ANAYSIS
ICV BUS SEGMENT

ICV Buses
Total Industry Market in 2012-13
(16914 units)
Tata Motors
Eicher
Others

23%

Ashoka Leylands
Swaraj Mazda

Growth over the years 2007-2013

70
60
50
40

1%

30
39%

20

Growth
over the
years
20072013

10

19%
18%

Tata Motors Eicher

Industry

INDUSTRIAL ANAYSIS
MCV BUS SEGMENT

MCV Buses
Total Industry Market in 2012-13
(28889 units)
Tata Motors
Eicher

Ashoka Leyland
Others

Growth over the years 2007-2013

2
1
0
-1

5% 2%
39%
54%

-2
-3
-4
-5

Growth
over the
years
20072013

INDUSTRIAL ANAYSIS
LCV, ICV & MCV BUS SEGMENT
LCV , ICV & MCV Bus
Segment

PROMOTIO
N

PRODU
CT
Provide ACs PTU (can be
applied to all countries
belonging to the Torrid Zone)
Product modifications such as
for school Buses & luxury
segment Installation of fire resistant,
electronic event recorder that
will function like black box o
aircrafts
PRICE
Introduce smoke detectors
More breakable windows Cut Cost by
Radium stickers for easy exit employing more
during emergency
diploma holders

4P
s

Promoted as investor
friendly
Promotion of it as a best
PTU for both
Upper & Middle Class - ACs
Lower Middle Class NonACs
Tenders of STUs for MCV
segment
Collaborating with Schools PLACIN
to insure safety of students G
by product enhancement

than B-Tech/BE
OR
Provide more
facilities on the
existing Cost.
Increase price of
Efficient use the Hub Spoke Luxury Segment &
Model
provide quality
Provide Full range dealership
Products
including all three segments i.e.

INDUSTRIAL ANAYSIS
LCV, ICV BUS SEGMENT

SCHOOL PROGRAMME STRATEGY

PRIMARY

MIDDLE

SECONDARY

129976

96737

55942

36874

41669 18717
12766 26295

34641

45700

830133595

2670
10799

1712

8661
15893

61680

26201
10144

17710
16667

635
2463

DELHI

UP

MAHARASHTRA

PHASE
I

MP

CHATTISGARH

ORRISA

PHASE
II

RAJASTHAN

AP

PHASE
III

The School Concept

Contd.

We have divided our plan into 3 phases

Phase I- Covers Schools of Delhi, Uttar Pradesh, Maharashtra
Phase II- Covers Schools of Rajasthan & Andhra Pradesh
Phase III- Covers Schools of MP, Chhattisgarh, Orissa
The Idea is to make buses more safe for children and promote them in the same
way. The sales team has the prime role in the idea
If we can just cover 20% of the market at each level of primary, Middle and High
School level , the market share can be increased by a very large amount
If each School has minimum 4 buses the total sales in the year will be
573140 units
The same plan is applicable for the School Vans sector too.

ACTION PLAN to increase sales to

whooping numbers
TATA should add some
additional features in its
school buses, some
measure are suggested in
the above slides

Sales Team Promotes TATA

buses as more safe for
children both to the school
authorities and parents by
some promotional
campaigns

Regular follow up with

the schools and
improvements thereafter.

HUB SPOKE MODEL- Common to all

Segments

Advantage of Hub Spoke

Model

Saves time
Saves Extra Inventory Cost
Saves overall Cost
On Time delivery of vehicles
It should be used effectively and efficiently by the
coherent work of both dealers and distributors.
Distribution network Outsourcing to some specific
can cut cost due to rise in petrol/diesel prices and
weak economy

Dealership Full range or Business

Unit wise ?
Full Range Dealership
ADVANTAGES

DISADVANTAGES

For a exporting firm

useful as it would
provide visibility of its
product

Costly

Provides more option to

the customer to choose
from

Lesser Market
Penetration

It is more customer
centric

Business Unit wise

Dealership
ADVANTAGES

DISADVANTAGES

Better for a local company, as it

understands the demand of the
customers at a particular place.

Lesser options to the consumer

More market penetration & less

Costly

Visibility of the products

decreases.

WHAT SHOULD BE TATA MOTORS

DEALERSHIP STRATEGY
For the Heavy & Medium Segments
TATA Motors should go for Business
Unit wise Dealership as the demand
of such segment is niche
For other categories the Dealership
model should be full range dealership
model.

FINANCIAL ANAYSIS & SUGGESTED STRATEGIES

Rising interest
ratesin the
economy is a
cause of concern
as it dampens
both capital
investments and
softens the
domestic
demand.

Excess debt has led

to ahigh Debt to
Equity ratioand
this is not good
news as the
company plans to
go for further
capital expansion.
Also the percentage
of cash flow used
for CAPEX is
increasing.

Positives:The cash
flow from operations
has grown 11 times
compared to last
year despite a huge
CAPEX. Tata Ace
single handedly
raised the market
share of Tata Motors
in LCV segment by
5%. The operating
leverage for Tata
Motors is higher due
to the high fixed
costs of CAPEX. But
still the overall
financial leverage of
Tata Motors is well
under control when
compared to Ashok
Leyland.

CSR Initiative Strategies

Provide health centers on the highways for
normal people and mainly drivers so as to
promote drivers health
Invent eco-friendly vehicles and promote
TATA as a brand which cares for the
environment, because people today are
concerned for the environment
Collaborate with foreign & national
universities to improve R&D and come up
with eco-friendly technologies

THANK
YOU