Companies

How Guenter Butschek steered transformation at Tata Motors

S Ronendra Singh New Delhi | Updated on February 15, 2021

Guenter Butschek, CEO, Tata Motors   -  Businessline

His successor, Llistosella, needs to carry forward the legacy, say analysts

Tata Motors (TaMo) has, over the last five years, successfully transformed its image — from not only being a maker of the least expensive car or cars for cabs — to a full-fledged passenger vehicles player with innovative designs and world-class technology.

And, all these changes have happened under the leadership of Guenter Butschek in these years.

Marc Llistosella has now been appointed to the role of Chief Executive Officer and Managing Director of TaMo, effective July 1, for the next five years.

 

Quick decision-maker

Butschek, who plans to relocate to Germany at the end of the contract for personal reasons, has been the man leading this transformation in the brand image of TaMo, not only in the domestic market but also globally, with successful models right from Tiago to Harrier and now the Safari.

Under Butschek’s leadership, from a preferred choice for cab makers, Tata cars have made it to the top three consideration sets of a large part of the Indian car buying population today.

It was a very active stint for Butschek with several attempts at stitching an alliance, which would have paved the way for a more financially secure future, said analysts tracking the industry. According to colleagues and industry people who have worked with Butschek, he is a quick decision-maker and also does not shy away from voicing his views.

“He did the same for Tata Motors also, as soon as he took over as the MD and CEO five years back. He was clear about his agenda and also liked new talents in his team. I would say he has delivered what he promised in his tenure,” said a person who has closely worked with Butschek.

According to Gaurav Vangal, Associate Director, IHS Markit, “Apart from the change in perception of the brand in the car space, there has been an impressive turnaround culturally. From a slow-footed approach, the company has now turned into a sure-footed, high-performing organisation.” Analysts also said that Butschek’s main focus was not only on building the brand but also making the organisation more agile and futuristic, in which too he succeeded.

Tata cars that were once seen as ‘cabs’ or cars that ‘catch fire on the road’, are today praised for their design and technology, and customers are booking these vehicles despite a wait of even months.

“Apart from the change in perception of the brand in the car space, there has been an impressive turnaround culturally. From a slow-footed approach, the company has now turned into a sure-footed, high-performing organisation under Butschek,” Vangal said.

EV opportunities

Making electric vehicles (EVs) a successful business for Tatas was also another task wherein Butschek added a feather to his cap. “Our new vertical for e-mobility is uniquely positioned to capture the EV opportunities in India. We are leading the ecosystem development by preparing a tailor-made product strategy, leveraging the synergy between the Tata group companies and playing an active role liaising with the government in developing the policy framework.

We have demonstrated an innovation mindset in our product development process by receiving 104 patents last year, the second highest in India,” Butschek had said in the annual report last year.

Today, around 5,000 of these EVs (Nexon plus Tigor) are running on Indian roads.

“We are currently working on a comprehensive strategy of mobility solutions to leverage Connected, Electric, Shared and Safe (CESS) conditions of sustainable growth by enhancing the organisation’s skill, capabilities and talent pipeline,” he had said.

According to analysts, Butschek’s last launch of a flagship model will be the ‘Safari’ on February 22 and spinning off the PV business into a separate entity in April is also expected to be counted as another successful turnaround initiative in the business, under Butschek.

Now, going forward, the sustenance of product action is going to be critical, to hold on to its number three position.

So, Llistosella has to carry forward the legacy and many feel that he could be another right choice by the Tatas for the focus around commercial vehicles now.

But, why an expat, is the question many people ask. “They (Tatas) want somebody who can carry on collaborations and partnerships across the globe with a technology mindset, which many Indians do not yet possess as a quality,” said a Delhi-based analyst.

Also, Llistosella has a good background in the CV business, he knows people from global competitors, and the concept. So, if Tata is looking at partnerships or even acquiring some stakes in Daimler, although they are rivals right now, it will be a win-win situation for both, he said.

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Published on February 14, 2021
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