Tata Motors to launch cars in China
The Financial Express — December 15, 2006

Describing China as a 'fascinating and seductive' market, auto major Tata Motors has said it was looking at options to launch commercial vehicles and a passenger car range, preceded by a manufacturing plant.

"From the sourcing and selling point of view, China is both a fascinating and seductive market. And we have been looking at this market for the last two years," Tata Motors' managing director Ravi Kant said.

He, however, said entry into China was not an easy task. "We have to tread cautiously. We have not been able to find a solution for an entry to the market partly due to the entry policy provisions there," he said.

On whether the entry would be through a joint venture, he said: "We are currently looking at many possibilities".

Asked about the type of vehicles the company planned to sell in the market, he said it could be both commercial and passenger vehicles.

Kant admitted that Tata Motors would need a manufacturing presence in China if it had to sell its products there.

He said dealings with component manufactures in China was a way forward for the company for setting up its own operations there. "These vendors give us an idea of the market and how and where component sourcing should be done," he said.

On the benefits of sourcing components from the country, he said it was advantageous for any company as the landed cost of produce from China was cheaper than that in India.

"In many cases, the landed cost, including transportation and customs duty, is 10-15 per cent lower than here," Kant said, adding that Tata Motors was in touch with vendors in China as part of such plans.