Tata Motors is planning assembly of more Land Rover models in India, its Chairman, Mr Ratan Tata, said in an address to shareholders in the company's Annual Report for 2010-11.

Though Mr Tata did not mention any plans for local production of the Jaguar models, the assembly of the first Land Rover model – the Freelander – started earlier this year at its plant in Pune.

Engine plant

The automaker is also evaluating the possibility of common engine manufacturing facilities in India and the UK with its subsidiary Jaguar Land Rover (JLR). Joint development of products is expected to give the company a significant cost advantage.

“Assembly of other Land Rover products are also under consideration. To optimise the synergetic strengths between JLR and Tata Motors in India, an examination is also underway on a joint engine development programme, which would have manufacturing facilities both in the UK and India. The company is also considering assembly and localisation of selected products in China,” Mr Tata said in the statement.

Dealer networks

Tata Motors also plans to undertake various initiatives to “to revitalise the dealer network and improve market share”. This is to arrest a domestic passenger car market share decline of 0.7 per cent in 2010-11. In the previous fiscal, the company's car sales had risen 23 per cent, lower than the industry growth of 30 per cent (24.66 lakh vehicles).

Inflation

Speaking about more macro-economic concerns, Mr Tata also warned of an economic slowdown in Asia on the back of anti-inflationary measures adopted by major economies such as China and India, and the crisis in Japan because of the earthquake and tsunami.

“The health of the world economy in 2012 and beyond will depend more heavily on the economic health of Asia. Inflation is indeed a lurking enemy of healthy growth. Central banks in both countries (India, China) have initiated measures to slow down their economies to curb inflation.

“The resulting high interest rates, tighter credit regimes and higher fuel costs will dampen consumer demand for a range of consumer products, including automobiles,” he said.

Slowdown

Mr Tata, who is also the chief of the $67.4 billion salt-to-software Tata Group, further said while automobile sales have already started to dip in India, China – the biggest auto market globally, has also seen its first sales drop in two years.

“The quarterly growth figures in Asia have been declining during the year and it is expected that both China and India will register lower growth rates in 2011-12. There is therefore a likelihood of a general slowdown in industrial activity in Asia compared to the growth rates achieved over the past few years and possibly a noticeable drop in consumer demand for goods and services. It is hoped that a realistic balance will be achieved in the Asian countries …,” he said.

> roudra.b@thehindu.co.in

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