Consolidating presence overseas


Tata Motors, the country’s largest automobile company, is consolidating its presence in Africa with the launch of passenger cars in Ghana. The company has had a presence in Ghana for the last three decades through its commercial vehicles, but this move is part of the company’s renewed thrust on strengthening its grip on global markets and spreading to newer regions. In fact, homegrown automobiles companies such as Tata, Mahindra & Mahindra and Ashok Leyland have been growing their overseas business at top speed.

Tata Motors MD said growing business overseas is an intrinsic part of the automobile business and therefore it is important for the company to have presence in markets which compliment the economic conditions of India and help to mitigate the risks. Other automobile companies too share this view and have accelerated their international growth.

About 10% of Tata Motor’s revenues come from international sales and company officials indicate that this figure is expected to increase in the near future. In this year, the company has already added markets such as United Arab Emirates, Russia and the Democratic Republic of Congo, to its global spread, while strengthening its grip in Sri Lanka with its best-selling mini-truck, Ace. The company is now eyeing new markets in Europe such as Algeria, and some African countries such as Egypt. The company’s commercial and passenger vehicles are currently marketed in several countries in Europe, Africa, the Middle East, Australia, South East Asia and South Asia. It also assembles its vehicles in Malaysia, Kenya, Bangladesh, Spain, Ukraine, Russia and Senegal and is soon expected to begin operations in Brazil and South Africa.

Utility vehicle major M&M has entered Spain, Italy and France in the last few months. The company launched the pick-up version of its flagship Scorpio in South Africa and has used this product to enter the sophisticated automobile markets of Europe. Their Director (Overseas operations) says they are looking at strengthening the presence in Europe through the launch of the Scorpio pick-up in Turkey. They will also start selling their vehicles in Russia and Australia in a few months time.

The strategy of Indian automobile companies outlined above is crystal clear that is to consolidate and expand overseas with the experiences gained in India. This strategy is not only beneficial for the company but also make India proud because only a few years ago India was dependent upon imported vehicles in many categories whereas it is the reversal now.