Our ambition is to become No 3 in the Indian car market by 2019: Tata Motors

Our ambition is to become No 3 in the Indian car market by 2019: Tata Motors
Tata Motors Head — Marketing (Passenger Vehicle Business Unit) Vivek Srivatsa is new to India’s largest automobile company. However, he believes that it is a good time to be part of the company, as it is launching more products and a lot of fresh initiatives around the corner.

In an interaction with DH, Srivatsa talks about Tata Motors’ ambition to become one among the top three players in the Indian passenger car market.

When did you join Tata Motors, and how do you feel?

I have been with Tata Motors for six months now. It’s a privilege to be a part of the Tata Group, and I think they are really on the verge of huge growth in the market.

What brings you to Bengaluru?

We have the Hexa Experience Centre conceived as a road show. We have the new lifestyle SUV Hexa being launched soon. And before the launch, we want customers to actually experience the car.

The road show goes around many cities in the country, and we had our first experience centre in NCR, and the second one has come to Bengaluru, and after this, we go to other cities. Bengaluru is a very important city for us, and we are doing pretty well here, and it’s time to show customers our product.

Please share your future plans.

We are doing very well with the Tiago, which is one of our products, we launched last year. We are number four in the market right now, in fact in the month of November we were number three. And our slated ambition is to become number three in the Indian market by 2019. We will have a lot of new launches coming up, lot of initiatives in terms of customer experience, so that the customer can experience our car better, and have a much more upmarket buying experience with Tata Motors, buying and after sales experience. A combination of this will ensure new cars, and a better customer experience will ensure that we become number three by 2019.

What’s the idea with 2019?

It’s not possible to just become number three in the market overnight. We have given ourselves three years time to get there.

Could you give us the breakup of the SUV segment with market share?

The SUV segment is one of the fastest growing segments in the country now. Usually, the hatchback segment is the largest segment in the market. But SUV segment is growing very fast and one of the segments that it is eating into is the sedan segment. In fact, this year, both sedans and SUVs are at around 20%-22% of the market of passenger cars.

That’s why, it’s important for us to launch a car which is a very good competent product in the SUV segment, and we are approaching it in a very confident manner. No manufacturer shows the car to the product, and actually allows customers to drive the car much before the launch. Usually, it is seen as a static display, but now actually, we are getting customers to drive the car not in normal conditions, but in extreme conditions. We want to show customers that we are extremely confident about the product and we will launch it in a very strong manner in January and hope to gain a good market share in the category.

What are your expectations from Hexa?

As I said, we want to make a very good impact in the SUV category. It is a very important category, because it has growth as well as volume. With Hexa, we want to make a big dent in this segment, and also show customers a different and strong value proposition.

We believe that some of our competitors are doing pretty well but at the same time we believe Hexa as a product has a better value proposition for a customer. So we hope to make a strong impact and redefine the segment in the terms of value.

What are your expectations for the number of cars to be delivered?

We don’t normally share sales expectations. But I can tell you that you can look at the segment, I mean category. So, the prime competitors for this car would be the XUV 500 from Mahindra, they sell about 3,000 cars a month. The Innova sells about 7,000 cars a month. So we will be in that kind of a ballpark in terms of volumes.

What is the contribution of Karnataka towards Tata Motors nationally?

It is one of the markets where we are very strong. Our lead product so far has had a very strong following here. Our latest hatchback Tiago, which is now the number one volume contributor for us, is also doing extremely well. Karnataka, and Bengaluru in particular, is a very important market for us. And that is why, after the NCR, we are here.

What are the three major challenges with respect to Tata Motors? Because, as you said, the SUV segment is growing immensely, and the Maruti Vitara Brezza has rocked the market. So pricing is very important. How do you see it?

The Indian customer is value-conscious now. I won’t say that he is price-conscious. When I say value-conscious, if he sees the value that he wants in a product, he doesn’t mind paying the right price and that is something many manufacturers are starting to realise.

It is not enough to give a low-priced product which doesn’t have what the customer wants. So, today, it is a challenge to understand what the customer really wants, and then price it at an acceptable level.

Again, we believe that we will do it with the Hexa. We understand the need of the market, the need of the customer. And we hope to also give customers very good value for money in terms of prices.


What would be the production capacity for Hexa?

We can produce as per customer demand.

Tiago scored very well, and Tata Motors has come again in the limelight of customers. People are talking only because of Lionel Messi.

Lionel Messi helped us in creating awareness, but the product is extremely strong. In the automotive market, you cannot win without the right product. And, with Tiago, we defined the segment value. In many parameters, the Tiago was best in segment. You take quality of interiors, exterior design, functionality inside the car, music system, the entertainment, infotainment package, the overall feel inside the cabin, the size of the engine, the power output of the engine, fuel efficiency, in various parameters, the Tiago redefined the segment, and still brought it to the customer at a very reasonable price.

Till date, how many Tiago units have you sold?

With the Tiago, we have crossed 50,000 bookings and we in fact will be close to 60,000 bookings right now. And production is catching up with bookings. Every month, we are taking more orders and have ramped up production for the same.

What is the production capacity for the Tiago?

We have sold about 60,000 cars so far in about 10 months, and we are catching up. That’s about 6,000 cars a month. We have an exclusive new plant for the Tiago platform in Sanand. The plant is about three-years-old. It was initially the Nano plant. Now, it has been upgraded to manage the Tiago platform.

How many production plants does Tata Motors have in India for PVs?

We have seven plants across the country. Passenger Vehicles are manufactured in Sanand and Pune. We make Tiago and Nano in Sanand. The Bolt, Zest, Safari, Indica, and Indigo are made in Pune, and the Safari Storme in Pantnagar (Uttarakhand).

After Tiago, which is the best model car sold by Tata Motors now?

The Zest is our compact sedan and it is doing very well. In fact, last month, we sold about 3,000 sedans. It was launched about a year-and-half back, but now, it is really picking up quite well. Our traditional SUV Safari continues to be very strong. And of course, our old work horse, the Indica and Indigo continue to deliver value because customers trust their performance a lot. So, we are not dependent on any one product to deliver our volumes. While Tiago sells the most, our volumes are well spread out across many products.

For the year 2016, How many vehicles will Tata Motors be selling?

It is difficult for me to put the number. But we hope to be number four in the market. We will be number four in the market by the end of the year.

What is the game plan for 2017?

We have already displayed two cars in the New Delhi Auto Expo, last year. So after Tata Hexa, we will have a new compact sedan, code-named Kite 5. The compact sedan will be launched, and later in the year, we will have another compact SUV called the Nexon which will be launched later in 2017. And with that we will be well on our way in terms of gaining market share and becoming number three.

So every year, two cars will be launched by Tata Motors?

On an average, I would say... It’s not evenly spread out, but definitely next year, we have two cars coming out.

The Kite will compete with whom?

Ans. The Kite will be a compact sedan. We will compete with Maruti Suzuki Dzire, Hyundai Accent among others.

And what about the compact SUV Nexon?

The compact SUV as you said is a very competitive segment. We will compete with the Brezza and Ecosport.

In terms of Tiago, which sells more — the petrol or the diesel?

Petrol out sells the diesel heavily. In fact, you will be surprised to know that it’s the top-end petrol, and the fully-loaded petrol which contributes close to 60% of our sales. And the top two trim levels contribute to more than 80% of our sales. It is really refreshing for Tata Motors and is a testament to our belief that if you give the customer the right value the customer is more than willing to pay for it. The Indian customer looks at value for money.

How many sales points do you have across India?

We have about 550 outlets, which include 3S outlets with sales, service and spares.

How about the improving service network? What are the strategies of Tata Motors to regain customer confidence?

We are focusing on customer experience, sales experience, and product experience, but after-sales experience is one of the key focus areas. We are already doing very well. In fact, this year, in the JD Power customer satisfaction survey, we were among the biggest gainers. We are number two in terms of points. So it’s a testament to the kind of efforts that our after sales team has put in, in terms of experience at the network, availability of spare parts, costing of spare parts, and turnover in time of our cars at the service centres. It is a comprehensive effort we are undertaking, and for us, it is one of the most important parts of building the brand, aftersales.

Tata Motors sells more of yellow boards. How much of yellow board contributes to sales to the Tata Motors?

Not even one Tiago goes into yellow board. Tiago is a purely personal car. And, I can confidently tell you that our future products are strongly oriented towards personal segment. You will see Hexa, the kind of finishing of the product, capability it has, it is purely in the personal segment. And so will the future products as well. Yes, we have the confidence of commercial operators. Commercial operators buy cars which they believe will be on the road for a very long time, are very durable, easy to maintain, so we are not defensive about that. We do sell a lot to our commercial fleet operators. I mean even the new aggregators like Uber and Ola, believe and trust our cars a lot. But the gain in market share for us will come in the personal segment. And all our new products will be focused for the personal segment only. It will be very individualistic and self-drive kind of cars.

Which are the major cars sold to the taxi aggregators?
Indica, Indigo obviously. But recently we have opened out Bolt and Zest also to aggregators.

Finally, Zest is on yellow board now too?
Not completely, but to the aggregators, it is available. The Zest is doing extremely well with the personal segment as well. That’s why, I said the commercial segment has changed. No longer it’s a rule that what is available with aggregators will not be bought by the personal segment. Today, the Uber and Ola experience is completely different. You call for the cab on an app. You have a driver who goes with a map. So the experience is different. You have a lot of high-end cars as well, with the aggregators. Today, the commercial segment is changing completely. In fact, today, customers want aspirational cars to be available through Uber and Ola. That’s why, you have the Ola Prime and high-end cars available with the aggregators as well. The entire approach towards aggregators and commercial operation is changing, and we need to provide the best cars to them.

How about ecommerce players’ place in the market the big role for Tata Motors? Because, most of the car companies have tied up with so many ecommerce players?
I will classify ecommerce today as one very small aspect of the entire car buying experience. Ecommerce today is active in taking bookings of the car. But digital experience is something much bigger than just booking the car. And that’s where we have a digital corner here. We are going very strong overall as Tata Motors on digital, but specifically, with the Hexa as well. Today, with some of the digital tools that we have, customers can experience the car without going to the showroom, in fact with the mobile phone. We have an extremely adaptable website. We have a Hexa app where we can see all the features of the car in a very easy way. We have a 360-degree animated Hexa experience on the mobile where you can drive the car, and you can go inside the car and you can see features of the car completely on your mobile phone itself. And we have a 24-hour chat window which is opened just today, where you can chat 24 hours to any of our operatives and understand about the car. Hexa has a complete digital environment for the customer to experience. And in case, he wants to book digitally, we will open out a digital window for the customer. Ecommerce players opening bookings is one part of the entire digital journey.

Till date, you have not tied up with any of the ecommerce players?

We will tie up. We have our own Tata CliQ which is an ecommerce player, and Hexa will be available for booking through the Tata CliQ.

When will it start? Or it has already started?

At the time of launch.
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