Mumbai: The country’s largest auto maker by value and third largest car maker by volume, Tata Motors Ltd, is trying to play catch-up with Japanese and Korean counterparts by improving after-sales service.
The initiative, known as Tata Motors’ Service Edge, encompasses round-the-clock time-bound road assistance, quick repairs, insurance and spares, among other things. The company joins car makers such as General Motors India Pvt Ltd and Fiat Automobiles India Pvt Ltd that are offering branded services.
Rajiv Dube, president, passenger car business, at Tata Motors, conceded that quality rankings of Tata cars “have not been something to write home about.”
However, newer models such as the Indica Vista and the Manza have seen a rise in this measure, he said. Dube said a branded service initiative will help the company offer better after-sales services and improve rankings further. Tata Motors is also in talks with Fiat, with which it has an alliance, and may extend some of the services it offers the Italian car maker.
The service push comes as firms such as Carnation Auto India Ltd and Mahindra First Choice Services, Reliance Autozone and Carplus have entered the service and spares business. Given the high margins, car makers are waking up to the business potential and devising plans to get vehicles even outside the warranty period back into the fold. Typically, the average margin is 17-18% for spares and 25% for services.
As global auto makers seek to gain a share of the Indian market with small-car offerings, the Tata Motors initiative gains in importance with few differentiators among competing products.
Mohit Arora, director, India, at JD Power Singapore, says with entry-level cars increasingly winning sales in the smaller towns and cities, “an initiative like this will be critical in ensuring a just-in-time delivery of services”.