Tata Motors Manufacturing Plants

Bharat Benz entry study: (need to prepare a write up for this)

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Resources:

Economies of scale:

Tata Motors:

Tata Motors has six manufacturing plants:  

• Jamshedpur- Production and assembly of trucks and engine assembly
• Pune - Auto castings, elecronic tools, trucks and cars and utility vehicles
• Lucknow - Assembly of chassis of trucks, buses and module buses; manufacture of transmissions and engineering tools
• Pantnagar- Manufacture of LCV- ACE and passenger carrier MAGIC
• Sanand- Tata Nano
• Dharwad- ACE ZIP

Tata Motors has a 0.70-million1 annual installed capacity. Tata Motors’ heavy-duty truck factories in Jamshedpur, Pune and Lucknow are already running near its peak capacity. Rather than waiting for greenfield expansion in the near term, the focus has shifted to ramp-up of production, structural de-bottlenecking of the supply chain and rationalisation of strategic supplier base to improve efficiencies and capacity. This will help Tata Motors to meet growing demand of FY 2018 at a lower marginal increase in cost and not lose its market share due to capacity constraints. Also, with highest number of touch points of 14652, Tata Motors has a great reach to meet its customers across India.

Bharat Benz:

Bharat Benz has only 1 manufacturing plant with a capacity of 72000 units yearly and current utilisation is of around 35000 units. The plant is situated in Oragadam town near Chennai with localization rate for BharatBenz truck as 85%3 with more than 450 local suppliers out of which 41 per cent are based in Tamil Nadu and 44 per cent are in rest of the country. Bharat Benz has adopted a lean dealership model with 130+ touch points in major territories with each service station well equipped to deal with a breakdown, 50 mobile service vans or rolling workshops and company’s 24x74 helpline (available in eight languages for India).

Dealership experience:

Bharat Benz:

BharatBenz positioned itself as a modern, value for money brand with fuel efficiency 10 per cent higher than that of other domestic brands. However, they observed that Indian fleet operators and truckers focused on the purchase price but not on running costs. They tried to change this perception by explaining its target customer that though Bharat Benz truck cost 10 per cent more initially, there was saving on fuel and service. Not only did they worked on building dealership network from scratch, many customer-friendly strategies were put in place. First, it sold vehicles through a consultative selling model wherein the salesperson was a specialist of sorts who could guide and suggest the right model to the customer. This helped the brand build trust at the outset. It also employed master drivers in each of its dealerships who spent time teaching nuances of efficient driving to customers.