Strengths
and Weaknesses of the TATA Motors and JLR
Overview:
The
two companies have undergone various developments since their origin in different
dimensions. Their economic, engineering and image development have undergone
remarkable evolution. For example, after the expansion of JLR to large-scale
production, the company sold 194,000 units in 2009 (Blitterswijk and
Karadzhov, 2009, p. 13).
Other indicators of economic growth include the increase in employment
opportunities.
For instance, in 2011, Jaguar Land Rover, announced a
recruitment of 1,500 staff in Halewood and another 1,000 staff in Solihull Plant, in the subsequent year. The
engineering development of the company is also notable. Over the years, JLR has
successively produced deferent brands of locomotives successfully. JLR Company
has been focusing on producing vehicles of higher quality with an aim of
improving such elements as their engines, which were originally below 2000cc (Clegg et al. 2012,
p. 32). For
example, the 1948 Land Rover engine had an inlet exhaust engine in both four
and six cylinder varieties, with cubic a capacity of 1600cc. The capacity of
the preceding engines increased
in 1997 with the production the four-cylinder inlet exhaust Series I engine, with
1997cc.
The extent to which JLR has gone in relating to engineering includes,
and is not limited to the production of electric vehicles. With the Integrated
Rear Axle Drive technology dubbed electric terrain technology, it will allow
future vehicles to run without starting and to supply additional power over
ragged terrain. The electric engine is much more environmentally friendly as it
conserves energy, as well as minimizing carbon emission into the environment,
hence minimizing the rate of climate change. In 2008, JLR presented its electric
engine in an International show in North America that allows vehicle to run at
20 mph. In 2011, JLR launched Range Rover Evoaque (White, 2011, p. 191).
In
2004, TML acquired a South Korean truck company called Daewoo Commercial
Vehicles Company and the JLR, in 2008. In 2012, TML was ranked the 31st
in the Fortune Global 500 ranking of the biggest corporations in the world. Tata
has constantly increased its market area through the introduction of new
products into the market including trucks. These include the Novus and busses,
such as Globus and Starbus .In 2004 TML acquired the track-manufacturing unit
of Daewoo. In 2005, the company engaged
in an expansion project by acquiring about 21 percent of controlling stake of a
Spanish bus and coach manufacturer called Hipano Carrocer. In 2006, Tata Motors
acquired Marcopolo with an aim of fully building buses. It purchased 80 percent
of stakes of a company called Trillix based in Italy in a bid to strengthen its
capacity in engineering and design. Additionally, in 2009, TELCO acquired
complete ownership of Hispano Carrocera. Focus on the designs of Tata Motors reveals
that the company has gone a long way towards enhancing and producing high
quality designs .It is the third producer of passenger vehicles in India (Lester, 2007, p.
22).
With
compact, midsize and utility vehicles, its dealership connections, sale, spare
and service comprise of about 3500 points. As far as Tata Motors engineering
and design is concerned, it is important to note that Tata Motors has also
ventured in the field of electric vehicle production. TML developed an electric
version of Tata Indica and Tata Ace that used Lithium based batteries to run.
Indica was launched in India and Norway in 2010 and 2009 respectively. In 2010,
Tata Motors launched a CNG Electric Hybrid vehicle to be used during the Common
Wealth Games. This innovation placed Tata Motors as the first ever company to
produce an environmentally friendly bus for public utility in India. Among its
notable vehicles is Tata Ace mini truck that launched in 2005 and opened up a
new market segment for smaller commercial vehicles termed as Light Commercial
Vehicles (LCV).The vehicle was notably successful in India, as transporters and
single truck owners preferred it at the time. The sales of LCV had increased by
37 percent and approximated 28,537 units of sales by 2005. The company had sold
500,000 units by 2010 (Mortimer,
2009, p. 114).
On
the other hand, TML, in conjunction with Daimler Benw, produced its first
commercial vehicle in 1945. Next in line was the production of a passenger
vehicle: Indica, which was launched in 1998. The Tata Sierra was a typically indigenous
Indian vehicle (Blitterswijk and Karadzhov, 2009, p. 16).
TATA
Motors Strengths:
1. TATA
Motors have the protective shadow of
the Tata group which is an extremely strong and stable organisation for the
last 100 years. Hence, it naturally acquires a strong brand value and market
share.
2. Tata
is known for its high quality low cost cars and easily appeals to the middle
class section of the society which forms the majority of the Indian population.
Tata Nano is one such unique car which won the hearts of many Indians.
3. The
tie-up with various automotive majors has given it a substantial entry into the
overseas markets. There has been a remarkable growth in revenue followed by its
tie-up with Fiat motors and Daewoo motors in 2005 and 2004, respectively. It
also has a 21% stake in Hispano Carrocera, a coach bodybuilder from Europe. Marcopolo,
the Brazilian bus maker, and Tata joined hands to make state of the art buses.
They also formed a unit called Telcon with Hitachi to make construction
equipment.
4. TATA
Motors are extremely competent and adapt to the latest technologies in
automobile engineering. This is ensured by its research and design centre which
has been doing dedicated work since 1966. It also has a strong skill base
developed in the field of CAD (Computer Aided design), product lifecycle management
(PLM), manufacturing management and supply chain engineering (SCM).
TATA
Motors Weaknesses:
1. The
Western market is far more demanding than the Indian market; hence they will
have to put a great deal of effort to come up with high end cars.
2. Tata
cars are not a major attraction among the affluent sections of the society.
Thus, Tata products are typically meant for the common middle class man.
3. Lots
of multinational car makers in luxury as well as non-luxury segments are
setting up plants all over India. Since there is intense competition in its
country of origin itself, TATA Motors will have to come with more innovative
cars and better marketing strategies. The local car makers like Maruti Suzuki
and Mahindra Motors also offer intense competition.
4.
Even though they came up with a low cost
car like the Nano, there has been a lot of scepticism about the safety of the
car.
JLR
Strengths:
1. Jaguar
land Rover manufactures high end luxury cars affluent sections of the society.
2. JLR
products are mainly recognised for their elegant design, performance and class.
Their cars are also known for high speed racing car designs.
3. They
have won several awards from international agencies for their state of the art
products and have got excellent reviews from all the automotive magazines
around the world.
4. They
are totally committed towards emission free vehicles and perform constant
R&D to eliminate CO2 emissions from their vehicles. They have been
certified to the international environmental management standard, ISO14001,
since 1998.
JLR
Weaknesses:
1. They face stiff competition from luxury car
makers like BMW, Mercedes, Porsche (in Europe), Cadillac and Lincoln in the US.
The Japanese market also has been a great threat because of their highly
innovative designs.
2.
They have a smaller product range to
offer since Jaguar mainly makes luxury vehicles and Land Rover makes only off
road vehicles.
