SWOT ANALYSIS

STRENGTH:
yStrong Presence in the Marketplace: -Tata Motors is the only company in
India with a broad based presence across the industry, in all segments of
the commercial vehicles market heavy and medium commercial vehicles,
light commercial vehicles, pick-ups, sub one-tonne mini-trucks - and key
segments - compact, midsize car and utility vehiclesegments - of the
passenger vehicles market.

yUnique Understanding of Customer Need: - <ith 50 years presence in the
automotive business, Tata Motors understands customer needs and develops
products that meet their Needs. To consider a few examples, as early as
1980s, the company launched Light Commercial Vehicles, amidst Japanese
competition, in which it today strongly leads. In t he 1990s, Anticipating the
need for an affordable family car, it launched the now famous Tata Indica,
which occupies a leading position among compact cars.

ySkill Base Developed over the Last 40 Years: -Tata Motors is also very well-
placed on technology capability. The company had set up its Engineering
Research Centre as early as 1966.<ith 1400 scientists and engineers and
state-of-the-art development, testing and validation facilities, it is this
technology capability which has, allowed Tata Motors, over the decades, to
offer indigenously developed products. This strength has been accentuated,
with the inclusion of TMETC, TDCV and Hispano Carrocera in the R&D
network, besides several other specialist external agencies. The company no
longer needs to develop every necessity itself. Today it just has to manage
the process of product creation, drawing upon already available R&D and
skills from different sources.

yPeople Strength: - The Companys key strength is its people. The over
22,000
Employees comprise a very broad talent base, with the required skills in
every aspect of the industry. <ith increasing international initiatives by the
company, this talent base is now getting enriched with the necessary
competencies to respond to meet world-class standards of quality and cost.
The company will achieve this by developing and marketing relevant
products, on its existing platforms and new ones, which delight consumers
in every market they are introduced in.

yTata Motors linkages in Europe through Subsidiary Companies: - In October
2005,Tata Technologies Ltd, a 100 per cent subsidiary of Tata Motors,
acquired a 94.3 per cent stake in INCAT International Limited. INCAT is a
supplier of engineering & design, product lifecycle management and product -
centric IT services to the automotive, aerospace and durable goods
industries.

yTata Motors R&D in Europe: - Deepening its engagement with the European
R&D Space, in September 2005, Tata Motors set up the Tata Motors
European Technical Centre, a 100 per cent subsidiary, in the UK. It is
engaged in design engineering and development of products for the
automotive industry. <orking synergistically, TMETC provides the company
with design engineering support and development services, complementing
and strengthening the companys skill sets and providing European standards
of delivery to the companys passenger vehicles.

yThe internationalization strategy so far has been to keep local managers in
new
Acquisitions, and to only transplant a couple of senior managers from India
into the new market. The benefit is that Tata has been able to exchange
expertise. For example after the Daewoo acquisition the Indian company
leaned work discipline and how to get thefinal product 'right first time.'


<EAKNESS:
The current financial situation of its recently acquired firms like Corus
and Land Rover-Jaguar is very big headache for the company and it should
be back to the track in the near future.
. The high ratio of debt equity ratio is also weakness of the c ompany.
The small car segment is still not good for the company due to maruti-
suzuki so, it need to tap this section also.
The CV segment is becoming highly competitive by new player like Volvo,
and rival M &M are coming with new products to cater the TATA in the
market as the rural area has given thumps up to M&M during this year.
The company's passenger car products are based upon 3rd and 4th
generation platforms, which put Tata Motors Limited at a disadvantage with
competing car manufacturers.
Despite buying the Jaguar and Land Rover brands (see opportunities
below); Tat has not got a foothold in the luxury car segment in its
domestic, Indian market. Is the brand associated with commercial vehicles
and low-cost passenger cars to the extent that it has isolated itself from
lucrative segments in a more aspiring India?
One weakness which is often not recognized is that in English the word
'tat' means
Rubbish. <ould the brand sensitive British consumer ever buy into such a
brand? Maybe not, but they would buy into Fiat, Jaguar and Land Rover.



OPPURTUNITIES:
Indias huge geographic spread-This is one aspect where the company is
looking for and its diversified range of cars suits very much this area of car
or say auto industry in country.
Easier finance schemes- The current fiscal stimulus and easy loan will
surely guide the company to post good sales as the current trend shows the
cars sales has been boosted by easy loan norms in the country.
Replacement of aging four wheelers-One of very important reason where
the car industry and commercial vehicle can take advantage in coming days.
Increasing Road Development, Golden Quadrilateral -as we all know the
Infrastructure will surely boost the auto industry as it is directly related to
the
Industry and the government policy in spending the money ion infrastructure
will create good demand.
Increasing dispensable income of rural agri sector -Somehow this year the
rural
Demand was very enthusiastic than the urban market which drive the auto
industry so, the development of rural infrastructure and condition will
create handsome demand from the rural area.
Higher GDP growth-<ith standing tall during the slowdown our economy
has shownthe industry that demands will gain momentum in near future ver y
soon.
Increasing disposable income with the service sector -As the consumers have
money in their hand definitely there will be demand from their side so, this
is also very good opportunity for this sector.
Graduating from two wheeler to four wheeler-The dream of NANO will
boost
Demand for four wheeler in the auto industry.


THREAT:
Indian is lacking in proper infrastructure this is slowing the pace of growth
of auto industry
Global crisis- this really hurts the Indian growing industry and not only the
auto but tyre industry went for toss.
High competition from foreign players-As the giants like GM, Audi, MERC
etc. are trying to capture the high segment market it is one of the very
effective threat to the company.
Other competing car manufacturers have been in the passenger car business
for 40, 50 or more years. Therefore Tata Motors Limited has to catch up in
terms of quality and lean production.
Sustainability and environmentalism could mean extra costs for this low-
cost producer.
This could impact its underpinning competitive advantage. Obviously, as
Tata globalizes and buys into other brands this problem could be alleviated.
Since the company has focused upon the commercial and small vehicle
segments, it has left itself open to competition from overseas companies
for the emerging Indian luxury segments. For example ICICI bank and
DaimlerChrysler have invested in a new Pune based plant which will build
5000 new Mercedes-Benz per annum. Other players
Developing luxury cars targeted at the Indian market include Ford, Honda
and Toyota. In fact the entire Indian market has become a target for other
global competitors including Mahindra and Mahindra, Maruti Udyog, General
Motors, Ford and others.
Rising prices in the global economy could pose a threat to Tata Motors
Limited on a
Couple of fronts. The price of steel and aluminium is increasing putting
pressure on thecosts of production. Many of Tata's products run on Diesel
fuel which is becoming expensive globally and within its tr aditionalhome
market.