Founded by Jamsetji Tata in 1868, the Tata group is a global enterprise, headquartered in...
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Founded by Jamsetji Tata in 1868, the Tata group is a global enterprise, headquartered in India, comprising 30 companies across ten verticals. The group operates in more than 100 countries across six continents, with a mission 'To improve the quality of life of the communities we serve globally, through long-term stakeholder value creation based on Leadership with Trust.
Tata Sons is the principal investment holding company and promoter of Tata companies. Sixty-six percent of the equity share capital of Tata Sons is held by philanthropic trusts, which support education, health, livelihood generation, and art and culture.
In 2020-21, the revenue of Tata companies, taken together, was $103 billion (INR 7.7 trillion). These companies collectively employ over 800,000 people. Each Tata company or enterprise operates independently under the guidance and supervision of its own board of directors. There are 29 publicly listed Tata enterprises with a combined market capitalisation of $242 billion (INR 17.8 trillion) as on March 31, 2021. Companies include Tata Consultancy Services, Tata Motors, Tata Steel, Tata Chemicals, Tata Consumer Products, Titan, Tata Capital, Tata Power, Tata Advanced Systems, Indian Hotels and Tata Communications.
Tata group has emerged as the successful bidder of the divestment process of the national carrier Air India. The Tata groups holding company, Tata Sons through its wholly owned subsidiary Talace Pvt Ltd submitted a winning bid of Rs 18,000 Crore as the Enterprise Value of Air India. Consequent to the acquisition, the Tatas will own a 100% stake in Air India (a full-service airline operating in domestic and international markets) as also 100% in its subsidiary Air India Express (a low-cost carrier airline that focusses on short-haul international operations especially in the Middle East market) and 50% in the joint venture Air India SATS (airport services on ground and cargo handling). The total permanent and contractual employee strength of Air India & AIXL is 13,500. More than 2/3rd of Air Indias consolidated revenues come from the international market. It is the number one player from India in the international market having a strong footprint across geographies like North America, Europe, and the Middle East with attractive slots & bilateral rights. Air India has also just announced direct flights to Australia commencing December 2021. The Tatas will get ownership of iconic brands like Air India, Indian Airlines & the Maharajah. Air India has a fleet of 117 wide-body and narrow-body aircraft and AIXL has a fleet of 24 narrow-body aircraft. A significant number of these aircraft are owned by Air India.
Tata Motors limited (tatamotors.com) was formerly called TELCO, an abbreviation for Tata Engineering and Locomotive Company. Today, Tata Motors is an Indian multinational company headquartered in Mumbai and a core member of the Tata Group.
Tata Motors was founded in 1945 and has joint ventures with Jaguar, Land Rover, Tata Daewoo, and Tata Hispano. The company entered the passenger vehicle market in 1991 with the launch of the model Tata Siera (a three-door sport utility). The global strategy is to increase everywhere except North America and Europe and make deeper inroads into Middle East, Africa, and Latin America.
Tata Motors strives in exporting, strategically using it as global vector to sell cars worldwide as well as to help offset cyclical tendencies in its home market in India.
As the fourth largest bus manufacturer globally, Tata Motors provides innovatively designed and technologically sophisticated buses for smart cities of tomorrow. The buses personify safety and comfort and reliability., and profitability. Designed using the most advanced technology, Tata Motors bus chassis are a benchmark in terms of performance and reliability in the bus industry.
Tata Motors exports buses and trucks to nearly 47 countries, including Russia and, 18 countries in Africa, four markets in Latin America and various countries in Europe, the Middle East and Asia Pacific region. Some of the popular vehicles exported include Prima and Ultra autos. Tata Motors also exports a variety of premium buses and coaches, from luxurious inner city travel vehicles to safe choices for the transportation of elementary children. Additionally, in the pickup and small commercial vehicle (SCV) segments, Xenon XT and Super Ace have been popular choices in many countries.
Future exporting activities for Tata Motors are mainly planned to target an increase presence in emerging countries (e.g., Africa, Asia Pacific, Middle Eastern, and Latin America). The company is placing its global bets on world class products like the Xenon, Super Ace, Prima and Ultra range of Trucks. The overall exporting goal is to continue entering new markets and to keep expanding the global footprint of Tata Motors.
Required:
How can Tata Motors use their core competencies in doing well in India to also do well in exporting? (6 marks)
Jaguar Land Rover Automotive PLC is a subsidiary of Tata Motors. How can Tata Motors leverage Jaguar Land Rover to their advantage in its exporting?
The Volvo Group is a manufacturer of trucks, buses, and construction equipment, which is owned by Swedish interests. Volvo Car Corporation or Volvo Cars on the other hand is owned by the Zhejiang Geely Holding Group. Because they are already successful in much of the world, should Tata Motors use this Volvo Group example and focus more, or even exclusively on, buses and trucks in its exporting?
Tata Group is growing rapidly by diversification across many different sectors and product lines and many countries. Is this a viable strategy?
Take into consideration its philanthropic strategy, global environmental issues, pandemic issues affecting supply chains and consumer behavior? What are the benefits and risks of their proposed growth strategy through diversification and what other innovative or entrepreneurial opportunities could Tata Group use?
If you were going to advise Tata CEO and sons (Tata Group), on a succession strategy for their operations in the future, what would you recommend? How should they get started with a succession plan? What should they do next? Offer them some general guidance on how to handle this problem. Refer to figure 15. 1 of textbook (Kuratko, 2017).
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