Help me study for my Business class. I’m stuck and don’t understand.
All original threads should be at least 250 words. This parameter helps to promote writing that is thorough, yet concise enough to permit other students to read all the postings. The thoughts and opinions expressed in your thread need to be substantiated by research and literature (from the textbook or outside sources). All references should be in correct APA style. While this is a formal discussion environment, you are allowed to use the first person perspective in all your posts since you will be expressing your personal opinions. All original threads should: Bring clarity to the issues being discussed. Raise new and novel (yet relevant) points. Relate issues to personal experience. Rationally defend your stated position.
Tata Motors and Exporting
This activity is important because, as a manager, you must be able to understand exporting as a mode of foreign market entry, its promise and pitfalls, and how to use it to improve overall profitability.
The goal of this exercise is to demonstrate your understanding of exporting and how firms can use exporting to increase their profitability.
Read the case and answer the questions that follow.
Tata Motors Limited (tatamotors.com) was formerly called TELCO, an abbreviation for Tata Engineering and Locomotive Company. Today, Tata Motors is an Indian multinational automotive company headquartered in Mumbai and a core member of the very successful Tata Group. The Tata Group was founded in 1868 and has annual sales of more than 105 billion U.S. dollars, of which Tata Motors makes up about INR 262,796 crores or about 42 billion U.S. dollars. Tata Motors has more than 60,000 employees; was founded in 1945; and serves a worldwide clientele with Tata Motors Cars, Jaguar Land Rover, Tata Daewoo, and Tata Hispano. The company entered the passenger vehicle market in 1991 with the launch of the model Tata Sierra (a three-door sport utility vehicle).
Tata Motors thrives in exporting, strategically using exporting as a global vehicle to sell cars worldwide, as well as to help offset cyclical tendencies in sales in the home market of India. Tata Motors exported about 55,000 commercial vehicles last year and plans to export 100,000 commercial units within two years. The target for the increase in exporting is everywhere worldwide except Europe and North America. The global strategy for Tata Motors specifically includes making deeper inroads into the Middle East, Africa, and Latin America.
As the fourth-largest bus manufacturer globally, Tata Motors provides innovatively designed and technologically sophisticated buses for the smart cities of tomorrow. The buses personify safety and comfort, 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. Fully finished, built buses from Tata Motors are often viewed as a hallmark of excellence, and these buses have been designed with the utmost quality standards in mind.
Tata Motors exports buses and trucks to nearly 47 countries, including 18 countries in Africa; four markets in Latin America; Russia; and various countries in Europe, the Middle East, and Asia Pacific. Some of the popular vehicles exported include the company’s globally benchmarked range of Prima and Ultra. These brands have been developed with modern design and global markets in mind. Tata Motors also export a variety of premium buses and coaches, from luxurious intercity travel vehicles to safe transportation choices for elementary school children. The buses come in 12 seaters to 67 seaters. Additionally, in the pickup and small commercial vehicle (SCV) segments, Xenon XT and Super Ace have been popular choices in many of the countries.
Future exporting activities for Tata Motors are mainly planned to target an increased presence in emerging countries (e.g., Africa, Asia Pacific, Middle Eastern, and Latin America). The company will place its worldwide bets on world-class products like the Xenon, Super Ace, Prima, and Ultra range of trucks. The overall exporting goal is to continue to enter into new markets and keep expanding the global footprint of Tata Motors.
Sources: Shally Seth Mohile, “Tata Motors Plans to Double Export of Commercial Vehicles in Two Years,” Live Mint, September 16, 2016; “Tata Motors Exports Up 12% in December at 5,119 Units,” Indian Information Online (IIFL), January 2, 2017; and “Tata Motors Expect 30% Growth in Exports,” Business Standard, October 23, 2015.
Tata Motors is an Indian multinational automotive company headquartered in Mumbai and a core member of the very successful Tata Group. India is a potentially enormous market, and Tata Motors is doing well in that market. How can Tata Motors use their core competencies in doing well in India as a way to also do well in exporting?
Tata Motors is primarily targeting emerging countries (e.g., Africa, Asia Pacific, Middle Eastern, and Latin America) for its future exporting growth. Is this a viable and logical exporting strategy?