Our target is to be a strong No.2 and challenge the No. 17 min read . Updated: 16 Oct 2012, 09:07 PM IST
The newly appointed MD of Tata Motors talks about his plans to leverage the strengths of the company
Karl Slym, appointed managing director of Tata Motors Ltd in September, wants to make it India’s second largest car maker; it’s currently the third largest. This he plans to do by leveraging the company’s existing strengths, including the brand name, model line-up and production capacities apart from the technological and design capabilities of its Jaguar Land Rover (JLR) unit.
Slym, who earlier headed General Motors Co.’s operations in the country, said in an interview that he wants to make Tata Motors more customer centric and review the segments that the car maker wants to get into. Edited excerpts:
What is your mandate? Do you think there is a need to revive the company?
I don’t think the company needs a revival. In commercial vehicles, we have a very broad and strong portfolio. Yes we have got new competition coming in that area. For me, that’s an opportunity. When we get competition, it allows us to ensure that we are doing the right thing.
In fact, we took the opportunity in September. We have had the highest market share in 18 months in September at 62%. So, I think our commercial vehicles business is a little bit different from the passenger car side. On the passenger car side, I think we have some excellent products such as Nano, Manzaand Aria. But, honestly, they have not lived up to the expectations in terms of volume or success, which they should have.
So, my mandate to myself is that we’ve really got to chalk out this whole process between what is the new car, what does the customer want, what is the segment that we want to get into and then ensure that we get the business result that we deserve from the efforts that we put in.
What went wrong with Nano?
Nano, to me, is a great idea and a great concept. But, we sort of missed the whole game at the launch. We were not ready in the market. We didn’t recognize where we should go with the Nano as far as a customer is concerned. We did not have outlets in the areas where people would have purchased the Nano.
Do you think pitching it as an affordable car went against the product?
Probably, the extreme of pitching it went against it. We do want to pitch it as an affordable car. There is no change in that even now, it still needs to be an affordable car. But there was probably more emphasis on that than it should have been there. We ostracized some of the market at that time. Nano is just not a product. It is a car that has opportunities forever.
What is holding up Nano diesel?
We would like to do everything right first time. As you rightly said about the image, so we need to make sure that whatever we deliver and when we deliver is right. So we can build the confidence in customers.
It is an important segment to have, diesel. We can’t afford to have a single-fuel product. So, we will make sure that when you drive that you would like to buy that.
So, how do you plan to turn the tide in the passenger car segment?
We have some huge strengths. I think we have the DNA of the Safari, which is a winner. We should not throw that away. We need to take the 12-14 years of experience to certain areas which are quickly changing and make the most of that DNA. That’s what we need to do with the company.
We have got some great strengths. The brand factor is huge, which everybody in India knows about. They will not be able to say same thing about the other multinational companies in India. People have grown with the brands. So, that’s the benefit. We have a wide portfolio of vehicles. We have got an international engineering and design capability. We have got a huge network and capacity at the plant. So all of these things are coming together to give us the desired result.
But these things have been there with you for a while.
I am saying those are the strengths, which need to be brought to the customers who want to buy. Because that’s the issue at the moment. We have got all these things at the back end but when we come to the market, there is only 14% of the customers who want to buy my car.
What about the quality and finish of your cars?
I will tell you what I have done in my first three weeks. Most of this time has been either with suppliers, dealers or customers. From dealers and customers, I figured what they want from me. For suppliers, most of them know me, they need to know from me what I want. We need to make it clear what we want. We called the suppliers over when I visited my plant to check out the (Safari) Stormesome three weeks ago.
I told them to take a look at the car and tell us what you don’t like in the car. I think that’s the change.
I think some of the things that you are talking about is also about the perception. That perception is closer to the reality. It is up to us to make sure that for every car that comes, people should love to see that change.
As with the Storme, can we expect a similar exercise with your other products as some of them look dated?
You know a product lifecycle depends on what you are trying to do and how long is it going to take? So, there will be some short, medium and long-term perspective. So, there will be a slight change in products, which will be coming by the end of this financial year. In the medium term and long term, you will see product changes and much more product additions.
Will there be introduction of new brands as well?
We have to look at the names here. If the names have a reason to stay, these can stay. If the names don’t have equity, therefore, these should not carry on. We have to look at those individually. If a car got a name that we don’t want it to be then it is probably a good idea to change the name.
Obviously, you can’t change the name of the existing vehicle but when we bring the next level then you should think about what you want to be. To me, I have to look at who wants to buy my car and it’s not just about the product and you know the name is very important. People with brand engines sell huge amount of cars. So, we know it’s not just their car, it is the name of the engines, too.
We have to look at the baggage. If we look at the Safari, the baggage that comes along with that is a pretty baggage. We are okay with that baggage. Some of them may not be that attractive baggage. So for that baggage, we have to think about a change. So, if there is a baggage with a positive name, then we need to keep them and build them. I think its time for us to be a little bit more aggressive than what we have been.
You have been losing market share and Mahindra and Mahindra is very close to you. Do you aim to defend your market share and your number three position in the market?
Our target is to make sure that we are a strong number two player and we would also like to be number one. So, if you just talk about position then that’s our expectation. Does that mean I am going to do something stupid tomorrow to sell more cars to be number two tomorrow? No, I am not going to do that. I am not going to sell the Safari at 1 lakh. So, it is a desire to be a strong number two and there is no reason why we can’t challenge the number one. I know what we are capable of and what we can do. I don’t see any reason why we will not be able to do that.
When can we see synergies between Tata Motors and JLR in research and development?
There is some sharing of ideas already but as chairman Ratan (Tata) said and I would agree that there is huge potential both ways. Both centres have got incredible experience in their markets. As we are aiming to be multinational, we see that as huge opportunities… not just limited to learnings but a lot beyond that. They are into completely different space. There is no reason why in some of the things that they have got the capability and we can’t use them.
What are those capabilities?
We are not looking to create a Jaguar. There is nothing like that. We can have the capabilities to improve performance and offer lightweight kind of design. We can help them with some of the things that we have by virtue of being in a market where cost is important.
What about exports?
It is not the priority. The first priority is the domestic market.