TATA Winger in Malaysia

1 REASONS FOR CHOICE OF PRODUCT SELECTION (HINT-V, CM AND PRODUCT

SEGMENTS)

Tata Sumo/spacio

Tata safari

Tata indica

Tata indigo

Tata winger

Tata magic

Tata Nano

Tata Xenon XT

Tata Xover XT

Tata Manza

CHOICE OF PRODUCT TATA WINGER…

A. Malaysian market.

There is a strong competition in small car segment by local manufacturers who

have dominated.

Tata winger is different of its class and can be utilized as Passenger and utility

vehicle having comparatively low competition and new class of its own.

B. The statistics

Current passenger car is 2.8 lakhs

Expected to increase by 13%

Full support by govt by govt to introduce and bring in new joint venture and

associations.

YTD Make

Passenger

cars

Commercial

vehicles

4WD

vehicles Total Share Sales/month

1 Proton 155720 - - 155720 54.00% 12977

2 Perodua 66499 1589 14503 82591 28.60% 6883

3 Toyota 4556 7057 2172 13785 4.80% 1149

4 Nissan 2970 6377 534 9881 3.40% 823

5 Honda 4606 - 143 4749 1.60% 396

6 Ford 466 1770 963 3199 1.10% 267

7 Mitsubishi 37 1322 1571 2930 1.00% 244

8 HICOM - 2545 - 2545 0.90% 212

9 Daihatsu 169 2308 57 2534 0.90% 211

10 Isuzu - 627 1425 2052 0.70% 171

11 Suzuki - 508 1094 1602 0.60% 134

12 Mercedes 1163 127 6 1296 0.40% 108

13 BMW 1219 - - 1219 0.40% 102

14 Mazda 139 733 2 874 0.30% 73

15 Volvo 642 197 - 839 0.30% 70

16 Citroen 703 - - 703 0.20% 59

17 Hino - 381 - 381 0.10% 32

18 Peugeot 325 - - 325 0.10% 27

19 Audi 318 - - 318 0.10% 27

20 Kia 115 75 85 275 0.10% 23

21 TATA - 259 - 259 0.10% 22

22

Land

Rover - - 127 127 0.00% 11

23 Scania - 105 - 105 0.00% 9

24 Subaru - 79 - 79 0.00% 7

25 Inokom - 64 - 64 0.00% 5

26 Jeep - - 47 47 0.00% 4

27 BMC - 21 - 21 0.00% 2

28 Daewoo - 13 - 13 0.00% 1

29 MAN - 12 - 12 0.00% 1

30 Iveco - 2 - 2 0.00% 0

Total 239647 26171 22729 288547 100.00% 24046

2 REASONS FOR CHOICE OF MARKET SELECTION( HINT- AS ABOVE)

I. MALAYSIA Statistics

Sold 2010 5.5 million

Forecast 2011 6.2 million

Growth – 13%

Full support by govt by govt to introduce and bring in new joint venture and associations.

Conclusion: Growth is excellent full availability of required resources and at low cost. Associated in Asian region hence low transit and transport cost, low waver of sales and excise duty.

II. CHINA statistics

Sold 2010 17.2 million

Forecast 2011 17.7 million

Growth – 3%

Govt incentives such as tax breaks and rural subsidies have helped china annual

vehicle sales rise by double digits over the past few years

Chinese govt have encouraged foreign automakers to establish joint ventures and

share technology with local companies.

Conclusion: its very difficult to enter the market.

III. USA

Sold 2010 11.5 million

Forecast 2011 12.6 million

Growth – 8.7%

Americas dominance of global auto industry came to an end when China overtook

the country to become the worlds largest auto market

2008-2009 crisis two of big three automakers GM, Crysler had to seek govt

bailouts as sales slump to their lowest levels in 27 yrs

Conclusion: The cost of production setup is extremely high and huge investment is required.

IV. JAPAN

Sold 2010 4.8 million

Forecast 2011 3.5 million

Growth – -19%

Worlds largest manufacturere lost to China in 2009

still home to some of worlds largest car makers

Conclusion: currently going under crisis due to Tsunami and earthquake it will take some time

to recover. Current investment will be a big risk

V. BRAZIL

Sold 2010 3.3 million

Forecast 2011 3.5 million

Growth – 10%

biggest market considered as growth place for automobile

home for most recognizable brand Benz, Bmw, Volkswagen

Conclusion: Resonably ok but growth and other market global players are recently setting up

new plants like Chinese automobile “Chery Automobile” and Fiat announced it was building a

second factory in the country worth $1.8 billion, as part of a $5.9 billion investment

3 PRODUCT AND BUSINESS GLOCALISATION FOR TARGET MARKET(KEEPING ABOVE HINT IN MIND)

ANSWERS ARE LISTED IN BELOW 5 QUESTIONS.

4 WHAT ARE YOUR RARE STRENGTHS AGAINST YOUR COMPETITION (IDENTIFY WHO IS THE COMPETITION IN TARGET MARKET) CREATED BASED ON YOUR BUSINESS ARCHITECTURE DESIGN AND 3 ABOVE

ANSWERS ARE LISTED IN BELOW 5 QUESTIONS. AS WELL AS THE COMPETITORS ARE

LISTED ABOVE.

5 EMOTIONAL BOND BUILDING ACTIVITIES WITH M RESOURCE

ANSWER TO THIS QUESTION IS SAME AS QUESTION 5

1. GLOCALIZATION EFFECTS ON ALL 5PS AND ON THEIR BUSINESS ARCHITECTURE IN

INDIA.

C. PRODUCT

Engine Capacity limited to 1800cc to enjoy lowest duties

1. 10% Import duty

2. 40% Excise duty.

Automobile being brought to Malaysia in CKD to;

1. Save on import duty of 20% against 80% on CBU

2. Technology available in market

Meets Environmental Quality regulations Act, 1987 / 1996 on;

1. Motor vehicle noise

2. Control of emission from diesel / Petrol engines

Suitable for Average family size of 4.6 amd commercial firms with 9-13 seater.

Right hand drive

Suitable for Malaysioans who live in Joint family.

Optional feature in CNG

D. PRICE

Price sensitive market. Hence, Pricing to be Marginally lower than prevlent models

prices.

Attempt for Market penetration.

Priced @ RM 130,000

Compliance to emission norms and import duty requirements.

E. PLACE

Primary location is metro cities as they are place of demand.

Assembly units / Warehouses located near port to reduce transportation costs.

Assembly units / Warehouses located outside city limits as per legal norms.

F. PROMOTION

Tie-Up with local conglomerate DRB-Hicom.

Promotion and dealerships handled by DRB-Hicom on profit sharing basis.

Regular contacts with Commercial firms

Attractive discounts for bulk buying by corporate firms

G. BUSINESS ARCHITECHTURE IN MALAYSIA

Tie-Up with local conglomerate DRB-Hicom as per Local law of “Bhumiputera”

Assembly unit setup with annual capacity of 1,00,000 units. Will also include

exclusive Paint shop to suit local customer needs.

60% of parts sourced from well established local ancillary industries.

Tie-up with local logistics firm for delivey of assembled units to

dealers/showrooms.

2. Study the strategies to accomplish Volumes and Contribution Margins

Ans: The below strategies are adopted to attain Contribution margins;

Units imported in CKD form.

60% of parts sourced from local suppliers.

Promotion activity offloaded to partner company.

3. Comment on their segments selection and positioning strategies. Identify if they can

get in additional segments.

Ans: TATA Winger will target below markets;

Segement Selecetion:

1) Commercial firms which are looking for;

Luxury Passenger Vehicle

Hotel Pickup Van

Staff Transportation Vehicle

Executive passenger vehicle

Airport Transfer Vehicle or

Tourist transfer Vehicle

2) Joint Families

Positioning:

1) Commercial firms and Joint families;

Safety

Comfortable ride

Economy

Luxury

4. What rare strengths have they created vis a vis their competition?

Ans: The rare strengths would be;

a. Quality at competitive pricing

b. 15 days Delivery (as compared to 2 month delivery schedule of competitors)

5. What are they doing to create an emotional bonding with the "M" resource.

Ans: Preliminarily would include;

Training

Additional benefits;

o Competitive starting rates in addition to regular wage and performance

reviews for continuous growth in skills and earning capacity

o Performance-linked pay

o Extracurricular Crew activities

Recognition and rewards schemes