In order to hedge against the cyclical nature of the commercial vehicle (CV) business, Tata Motors has chalked out a global strategy. The aim is to substantially increase CV export volumes to 20-25 per cent of total sales in the next five years, from around 5-6 per cent in the last fiscal. 

Tata Motors has decided not to spread itself too thin and has identified a dozen countries where the company will have a major presence. These are geographically spread and include three-four countries in Europe, Africa, West Asia and South Asia. The countries chosen include, among others, China, South Africa, Russia, Sri Lanka and Bangladesh. 

Tata Motors will be adopting a combination of direct marketing, distributorships and appointing consultants to study these markets. 

“We need to choose segments where we can have the greatest benefits. So, we have identified segments in each country where we can be present, plus we are looking at some major breakthroughs in some countries. It is work in progress,” said Tata Motors executive director (commercial vehicle business unit) Ravi Kant, in an exclusive interview with FE. 

The dozen countries chosen will see the company doing what Mr Kant identifies with the “classical thing” about marketing — network, after-sales service, sales planning process, and other field-related activities to support the branding and marketing efforts. 

Clearly, South Africa is going to be a key market for the company where it plans to introduce its entire range of CVs. The company recently held a clinic of around 40 South African dealers in India. 

The company is also one of the three shortlisted bidders for a major taxi project in South Africa. This would envisage 100,000 taxis to be replaced over the next four years by 18 and 35 seater buses. 

China will be another important market. Tata Motors is close to acquiring Daewoo Commercial Vehicle Company (DCVC) for around $118 million which may provide a vital platform for the company’s China plans. 

“The benefits of these efforts would be visible from the next financial year,” points out Mr Kant. 

A key element of the company’s new international plans will be what the company is currently developing internally, called “trucks of the future.” 

Mr Kant expects these new generation CVs to roll out in about three years.