Tata Indica V2 Xeta: Competing in the Indian Small Car Market

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Case Details:

Case Code : MKTG177
Case Length : 28 Pages
Period : 2006 - 2007
Pub Date : 2007
Teaching Note : Available
Organization : Tata Motors Limited
Industry : Automobile
Countries : India

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Introduction Contd...

Analysts also felt that the Xeta had the potential to change Indica's image as a diesel car brand. Xeta's success coincided with the growing attractiveness of India as a global hub for small cars.

This led to the entry of a number of domestic and foreign players into this segment, which resulted in intense competition in the growing Indian automobile market. (For an overview on the Indian automobile industry refer to Exhibit I). Some of the companies which planned to launch small cars in India in and after 2007 were General Motors India (GM)6, Fiat, Toyota Motors, Honda Motor Co., Skoda India, and Renault7.

The entry of MUL and HMIL in the diesel segment of the small car market was expected to pose a strong challenge to Tata Motors which had the leadership position in this segment.

Background Note

On June 1, 1945, Tata Sons Limited (Tata Sons) bought the Tatanagar Shops (also called the Singbhum shops of the East Indian Railway) from the Government of India to manufacture steam locomotive boilers. It intended to extend its operations later to building complete locomotives and other engineering machinery. This project was set up as a new company by Tata Sons and was called the Tata Locomotive and Engineering Company Ltd. which was commonly known as Telco. Today, its manufacturing base is spread across India - in Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), and Pantnagar (Uttarakhand)...

 Excerpts >>

6] General Motors India is the Indian arm of General Motors Corporation (GM), the world's largest automotive manufacturer (as of July 2007). GM was founded in 1908 and is headquartered in Detroit, Michigan, USA. GM manufactures its cars and trucks in 33 countries.

7] As of July 2007, Renault was in preliminary talks with Bajaj Auto to discuss the possibility of producing cars in India, including a small car priced at around US$ 3,000.


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