It’s exactly 100 days since Mayank Pareek took charge as the President, Passenger Vehicle Business Unit, at Tata Motors. Though his move came at a time when Tata Motors was struggling to keep up its market share, Pareek did not have to think too much to leave his job as Chief Operating Officer of market leader Maruti Suzuki India. The challenge of turning around a company was alluring. Over the last three months Pareek has made it his top priority to make Tata Motors more consumer-friendly. In an interview with BusinessLine, he talked about his game-plan and the state of the industry. Edited excerpts:
How has the first 100 days been for you?
We are seeing some green shoots. In the last three months we are seeing growth, which is happening after almost one year. If you see our new products, like Zest, they have done well. Tata Motors was known as a diesel car manufacturer but with Revotron (Tata Motors’ first indigenously built petrol engine), customers love our petrol cars.
Is there a change in the consumer segments interested in buying a Tata car?
A new breed of young customers is visiting the company’s showrooms. Earlier, it was mostly fleet-owners that used to come in. Now, about 58 per cent of our customers are less than 38 years old. So we are preparing our dealers to deal with the new segment of customers, who have to be treated well, they need to be pampered. Fleet owners are only bothered about prices. Everybody has a heart for Tata Motors, and we are building our future on that.
How does Bolt fit into your turnaround plan?
The company is banking big on Bolt. Every month, around 2,20,000 cars are sold in India, of which about 1,00,000 are compact cars. The initial response is very encouraging. So far 33,000 customers have registered to test-drive the car. The company is not making the mistake it made when launched Zest, when supply could not meet demand. When we launch (Bolt), we are ensuring that there are enough cars in the showrooms.
What are you doing differently to make Bolt a success?
We are doing a lot of things that are traditionally different from what we usually do. For example, we started the build-up to the launch for Bolt almost three weeks earlier. Ground-level activations were done across 30 cities, enabling customers to touch and feel the car. We have recruited a completely new force of 1,276 personnel, called the ‘Bolt Force,’ and have trained them differently. The company is also giving a refresher course ahead of the launch.
The company had announced the Horizon Next plan. Will you continue with this?
Yes, I am focussed on the four pillars under Horizon Next. We have an extremely good line-up of product launches till 2020, wherein we will launch two new products every year. We are aligning of our processes with JLR to be able to continuously deliver world-class quality. We have created a separate vertical for customer experience. We want to be the most customer-centric company in the world.
At Maruti you had undertaken some interesting initiatives. Do you plan to bring some of those ideas to Tata Motors?
Each company has a different roadmap. It is like cricket; every pitch is different. You can’t play the same game in Mumbai and Sydney. But, yes, I will definitely bring in the segmented marketing approach. India is a diversified market and you can’t have one vanilla option for everyone.
What is your plan for rural markets?
We need to go to the rural markets. We have about 460 dealerships, which we need to increase threefold in the next 4-5 years. We need to be as close to customers as possible.
What do you make of the decision on excise duty?
The industry is struggling and our request to the government is to please reconsider it. With manufacturing being the focus, the growth of the automobile industry will result in the growth of many other sectors.
Overall, do you think the auto industry will revive soon?
In the long term, the industry should do very well. It is an under-served market and people need mobility.
Second, as the road infrastructure grows, it will help the passenger car sector. Fuel prices are manageable now and a lot of first-time buyers are coming in. The market should more than double to 5-6 million units a year.
In the short term, there are a lot of challenges. The immediate challenge is that of excise duty. Interest rates continue to be high as 75 per cent for cars bought with loans.
Are you looking to export cars?
My immediate focus for the next 6-8 months is India. First let’s make in India, win in India. This is an opportunity to turn around this great company.