New models, dealer focus rev up Tata Motors

CHENNAI: Tata MotorsBSE 0.35 % is working on a combination of network expansion, dealer development and product repositioning to turn around its passenger vehicle sales. According to a top company official, this, along with an aggressive new products strategy with plans to launch two new vehicles every year, is expected to help the company regain its position in the industry pecking order. Put in place by Mayank Pareek, president (passenger vehicles business unit), Tata Motors, the new strategy has already helped Tata Motors gain 1 per cent market share in the first five months of this financial year.

"For the past seven-eight months, we have been outperforming industry," said Pareek."Part of the reason is that the company has launched new products after a hiatus of fourfive years. With Zest and Bolt, we are getting the right type of customers coming to us," he added. "Earlier, there were no new products, so we had to rely only on fleet customers. Now were getting young executives and young families."

A repositioning of its products has also helped the sales turnaround. "Historically , Tata Motors has been known for its diesel engines. But after the launch of the Revotron gasoline engine, both Bolt and Zest are now clocking 45-55 per cent sales in petrol variants." The company's older products have also been given a positioning tweak. "Our new models have grown, but re-segmenting and repositioning has also helped older models to grow in sales," said Pareek. For instance, in August, Indica grew 100 per cent and in the April-August period it has grown 70 per cent. "We re-segmented the Indica to target smaller towns. Although it may be a bit dated for bigger towns, it's a perfect fit for smaller towns. Both the Indigo and the Indica are being repositioned for smaller markets," he added.

That apart, the company is revamping its dealer development strategy and rapidly expanding its network to tap new markets, including rural areas.First, it is completely revamping its showrooms and recruiting aggressively . This is backed by an extensive training programme. "To expand our presence, we're also experimenting with our retail format," said Pareek. "We're introducing the small dealership format for smaller markets where the customer gets the same experience but the showrooms are smaller. We are also working on virtual showrooms where customers can have 3D experience of the cars. We will introduce these digital showrooms in a year," he added.

Additionally , Tata Motors is also upping the game in terms of service infrastructure. "We're introducing the mo bile workshop and the pilot will be completed middle of this month," he said. "Our target is to have 1,000 mobile workshops this year. We're targeting hinterland markets where there are no dealerships close by , but we also want to take car service to the customer's doorstep. We feel that's the way to build long-term competitive edge," he added.

That apart, Tata Motors has launched an aggressive retail expansion plan that will see it treble its dealer outlet count to 1,500 in three years. "Last year, we added just 29 new dealers. But this year, so far, 63 have been activated and 185 appointed," said Pareek. "The plan is to activate 200 this year and appoint 300-plus. This is critical because India is a huge market and you need to be present everywhere." That expansion drive will also include Tata Motors strengthening its rural footprint.