Tata Motors — Setting New Benchmarks in CV Market

"Tata Motors has been in the Indian CV space for over 50 years now. Over this period, we have developed a very deep understanding of the Indian market. We have the widest portfolio of CVs to cater to the requirements of every kind of customer and a pan-India service and sales network. Given our scale, we are in the best position to efficiently integrate our products and services and deliver the maximum value to the customers at the lowest cost. We have been leading the transformation in this industry even before the entry of global players and have hence remained the first choice for our customers. Our objective is to continuously ensure that our production is aligned with demand. In the long-term context, we are bullish about the industry," says Mr. Vinod K Sahay, Head (Sales & Marketing) –M&HCV Trucks, Tata Motors, in an interview with S.A.Faridi & S.K.Khanna.

What is your overview of Commercial Vehicles (CV) market in the country for construction and mining applications? Do you think the present slowdown spell has subdued their market?
The major reason for the fall in demand, in the recent months, has been the slowdown in the economy. Manufacturing and mining – key demand drivers for the CV industry – contracted in March on a year-on year-basis. This trend has continued in April as well. End consumer demand has been depressed on account of high interest rates. The capital goods index, a key indicator of investments, contracted by 21% and 16% in March and April respectively. Due to lower economic activity, there is substantial drop in freight availability in major trucking centres which has led to lower utilisation of existing fleets and drop in freight rates resulting in further pressure on profitability of transporters.

Over and above this, increase in excise duty in the range of 2–5% across different categories of MHCVs has further affected sentiments. In April, the full impact of the ED increase has been passed on to customers which coupled with the state of the economy has depressed the demand.

Major demand drivers for MHCV trucks are construction, infrastructure development, manufacturing, movement of agri–goods, mining and export/import. Unless there is significant growth in these sectors, we expect the current trends to continue. A good monsoon will spur growth to an extent and provide some relief. However, a major stimulus would be required in infrastructure sector to see a sustained improvement in demand. Our objective is to continuously ensure that our production is aligned with demand. In the long-term context, we are bullish about the industry.

What are the challenges CV industry face and what is immediate attention that required to create enabling business environment?
For M&HCVs, amajor stimulus would be required in sectors like road construction and infrastructure projects, resumption of mining in critical markets like Bellary, Goa, Orissa and Jharkhand, etc to see a sustained improvement in demand. Interest rates also will need to come down. These trends need to be reversed in order to create a favorable business environment.

From indigenous development of mini-trucks to the development of new technologically advanced range Prima trucks, the company has embarked on new benchmark in the vehicle industry. What sets apart this development from the competition point of view in trucks like Prima?
Tata Motors has been in the Indian CV space for over 50 years. Over this period, we have developed a very deep understanding of the Indian market. We have the widest portfolio of CVs to cater to the requirements of every kind of customer and a pan-India service and sales network. We are in the process of developing multiple new platforms in line with market requirements. We are continuously working to improve the performance and reliability of our products. Besides the products, we have also developed a host of innovative service offerings to delight our customers even further. Given our scale, we are in the best position to efficiently integrate our products and services and deliver the maximum value to the customers at the lowest cost.

We have been leading the transformation in this industry even before the entry of global players and have hence remained the first choice for our customers. TATA Prima is still the best Truck range available in India whichever way you look at it right from Cabin features, Power to weight ratio, Safety aspects, advance technology, quality and reliability and return on investment.

We will continue to be close to our customers, respond to their changing needs and are proactively taking steps to ensure that we remain the preferred brand to our customers. Tata Motors' range of Trucks have been the best in the KMPL, operating economics and TCO (Total Cost of Ownership) and the way we have planned our products strategy, we will continue to be the best even in future in spite of more players entering into the Indian industry. Over the past few years, many global CV majors have attempted to enter into the Indian market – they have failed to create an impact till now though.

Indian CV market is maturing towards ROI from initial investment mindset; what are the technological attributes and USP of Tata Prima?
The Tata Prima range, of which the Construck range is a part, comprises about 10 major variants of multi-axle trucks, tractor-trailers, tippers, mixers and special application vehicles. The first product, the Prima 4028 S tractor-trailer was launched in November 2009, and was followed by two 49-tonne tractor-trailers in the same financial year. The range has been jointly developed by Tata Motors and its two subsidiaries, Tata Daewoo Commercial Vehicle Company in South Korea and the Tata Motors European Technical Centre plc in the UK. The company has harnessed the best of inputs and technologies – in styling, engines, transmission, suspension, chassis frames, fabrication and dies — from partners based in countries like Italy, Germany, Sweden, the US, Japan and South Korea.

To ensure optimum vehicle usage, these vehicles are also equipped with a data logger that helps measure vehicle performance and driving practices along several parameters on a daily basis. The increased power ensures faster trips and higher profitability.

A HVAC cabin (heating, ventilation, and air conditioning), Pneumatic suspended driver seat, ergonomically designed instrument cluster improves driver efficiency, resulting in increased productivity and faster returns on investment.

For technologically advanced products, the prime need is of trained drivers; what are Tata Motors initiatives to impart training to the drivers?
India ranks highest in the world with 1.2 lakh road fatalities, occurring annually. There is also a huge shortage of trained drivers in the country. Starting 2010, National Skill Development Corporation (NSDC) has estimated a demand for over 50 lakh drivers, over a period of 10 years. Thus, Tata Motors has devised a two pronged strategy, addressing the issue of road safety and help in providing employment opportunities to the youth, through a special Professional Drivers Training initiative called Kaushalya.

Tata Motors realizes that a driver is a key stakeholder in the transportation industry and has undertaken the initiative of providing them with the required skills to drive, and also help improve the dignity of the profession.

In February 2010, the Government of Punjab and Tata Motors inaugurated the Punjab State Institute of Automotive and Driving Skills (SIADS), at Mahuana in the Muktsar district of the state. The institute has been set up in an area of 14 acres and has a modern complex, testing track, computerised driving test and hostel facilities. Tata Motors has invested in the institute for providing support in the form of designing course content, technical assistance and know-how, guidance, vehicles, training aggregates and teaching aids. The training aims at developing the right attitude for safe driving and road safety among learners.

The institute has already started training drivers for heavy and light commercial vehicles, buses, passenger cars, off-the-road (OTR) vehicles and also technical training related to trades such as auto mechanics, welding, painting, electrical, electronics and air-conditioning for the last four months.

Similarly, Tata Motors in August 2011 launched a Commercial Vehicle Driving Centre in Jabalpur. The centre has been established with an objective to impart training in driving light and heavy commercial vehicles.

Through such pioneering initiatives, Tata Motors is looking at training more than 3.4 million youth by 2021 and thereafter, a million every year through 1,600 such driver training centres and is constantly exploring similar partnership programs in other states.

Selecting right products for different projects is really difficult; how do you help the customers to select the right products as per their projects requirement?
Customers have realized the importance of high end reliable products which guarantees them a higher ROI, uptime and higher profitability. Tata Motors has addressed this segment through PRIMA range of tippers which offer the customer a unique balance in terms of affordability and reliability.

Tata Motors has products across with GVW ranging from 16T-31 Ton, engine HP ranging from 130 Hp to 270 Hp. PRIMA 3128.K 8x4 and 2528.K 6x4 ensures higher ROI, uptime and thereby ensure higher profitability for customer.

In the multi-axle tippers range, customers have options of LPK 2518 to LPK 2523 with standard or inverted bogie suspension with options of 6 speed or 9 speed gear box.

In two axles tipper segment Tata Motors offers its customers SK 1613 with 3600mm and 4200mm wheel base with 8.5 Cum and 10 Cum body options. These tippers are available in semi forward. In full forward range, we offer LPK 1613 and LPK 1618 with 10 Cum tippers.

As minimum downtime is the key differentiator; what are the important things after market services, maintenance services and spare parts facilities available to maximize up-time of the Tipper?
Tata Motors has an extensive network across the country with more than 1000 workshops and over 7700 retailers ensures effective service and availability of spare parts in every pockets.

Tata Motors provides 24x7 Onsite service support to its customers with a company trained engineers/technicians at site, spare parts stocking is done at site to ensure effective preventive and repair maintenance and higher uptime.

A word about Tata Motors' CV manufacturing facilities and its locations. What is the range of tipper trucks currently available in the market?
Established in 1945, Tata Motors' presence indeed cuts across the length and breadth of India. Over 5.9 million Tata vehicles ply on Indian roads, since the first rolled out in 1954. The company's manufacturing facilities in India are spread across Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar (Uttarakhand) and Dharwad (Karnataka).

Our Milestones development includes:

• Over 3,500 touch points for sales, services and spare parts network.
• The first Indian company to be listed in the New York Stock Exchange.
• In 2005, launched the Tata Ace, India's first indigenously developed mini-truck.
• In January 2008, Tata Motors unveiled indigenized developed world's cheapest Car, the Tata Nano.
• In May 2009, Tata Motors unveiled its new range of world standard trucks Prima.
• Prima trucks with their power, speed, loading capacity, operating economics, and lower life-cycle cost, are setting new benchmarks in the industry.