Tata Motors Case Analysis
Background
Tata Motors Limited ( Tata Motors ),has emerged as the world cheapest car of the India. Ratan Tata, chairman of Tata Motors Limited ( Tata Motors ), saw the purchasing power of people is dynamically developing as economic of India continue to develop and global automotive industry. Tata can take advantage of its low cost pricing by entering to Western car market. Tata motors bid and negotiations to acquire Jaguar Land Rover (JLR) from Ford Motor Company (Ford).JLR provides Tata motors with opportunities to establish itself in luxury brand.
Situation Analysis
Strengths
- Strong domestic player (India Market)
- Wide distribution and service network
- World cheapest car
- Enough capital funding
- Chairman
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Alternatives Pros Cons
1. Related Limited Diversification strategy (current strategy) - Have economies of scales
- Increase demand of car in India
- Rely on local market ( sells 81% ) - Low image in brand
- Global economics crisis
2. Related extensive strategy through acquisition of JLR - Market can be more focus through JLR.
- Low fuel consumption
- JLR brand name was affected by Tata
3. Unrelated extensive strategy through acquisition of JLR
- Tata & JLR have good history
- JLR is suffering losses for the past 10 years
4. Related extensive strategy without acquiring JLR - Enough capital funding
- Famous brand in affordable price - Tata’s concept should be change in low price cars.
Recommendation
Strategic
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Related extensive strategy through acquisition of JLR - Market can be more focus through JLR.
- Low fuel consumption
- JLR brand name was affected by Tata
3. Unrelated extensive strategy through acquisition of JLR
- Tata & JLR have good history
- JLR is suffering losses for the past 10 years
4. Related extensive strategy without acquiring JLR - Enough capital funding
- Famous brand in affordable price - Tata’s concept should be change in low price cars.
Recommendation
Strategic Intent
Tata aims to get international market.
Strategic Mission
To get international market through mergers and acquisition of JLR with the world cheapest price.
From the evaluation of alternatives, Tata implement unrelated corporate strategy to reach its goal.
Key Result Areas Strategies Objectives
Sharing activities - Share the technologies between the car brands - Economy of scope
Keep the brand under different management - Make sure that the image of the brans don’t mix - To enable the company to diversify into more markets
Develop a corporate strategy to achieve maximum economical scope - Decentralization should be encourage - To maximize the profitability of the