Tata Motors, a regular at the Geneva Motor Show for many years now, has always attracted the attention of the international motoring media and the automotive industry’s elite in what is arguably the world’s most important auto show.

It started off with the Nano and the acquisition of Jaguar Land Rover (JLR) – both of which happened in 2008.

But at this year’s Geneva Show, the Tata stall was spectacularly empty. There were a couple of concept variants — one of the Indica and the other of the Safari, but nothing that could capture the imagination of the visitors and shake up their perception of the ‘Made in India’ tag.

Compare that with the previous two years, when Tata Motors’ micro car concepts — the Pixel and the MegaPixel — were so cute and plausible that Chinese and Japanese journalists had to be escorted out of the turntable because they were trying to get a photograph of the car’s underbody and engine bay.

However, at Geneva this time, since it had nothing seemingly significant to showcase, Tata Motors chose to give up its 15-minute slot for a press conference on the media day. Juxtapose this with the slowdown that the industry is currently facing and the company’s performance in the domestic market. The question that comes to mind is whether Tata Motors is now at a crossroads. Is it in need of a spark, a new kick-starter for its passenger car business?

Tata Motors has undoubtedly transitioned from being viewed largely as a commercial vehicle manufacturer. But, despite one-and-a-half decades of a strong presence — in not just the mass market passenger car segment — Indian buyers still view it as a maker of economy cars. Now, that need not be a handicap, but it does leave the company with a problem, especially when its other, more expensive cars have lower acceptability. The Tata Aria is a classic example.

Equally ironical is the brand’s appeal seemingly suffering during the ongoing demand slowdown driven by economic uncertainty, when traditionally you would expect buyers to become more tight-fisted and step down the price range.

After growing by a nominal 4.5 per cent in the domestic market during 2011-12, passenger car sales in India closed 2012-13 with a fall of about 7 per cent.

Tata Motors, however, has had an even rougher year with its passenger car sales falling by roughly 31 per cent over the 2011-12 volumes.

So, how can Tata Motors’ passenger car division climb out of this morass? Here are a few suggestions.

Boost coolness quotient

An overemphasis on practicality and affordability is always a dampener in the auto industry, just as much as a brand that is perceived as being expensive in the mass market segment.

Tata Motors’ portfolio has over-leveraged affordability as the primary platform and it now needs a few models that are showy, modern and bordering on being over-designed.

The Indian buyer is willing to experiment with an Indian car that seems to have global design cues.

While at it, there has to be a parallel improvement in interior design and fit and finish quality. The Aria was a good attempt; only that it was the right move in the wrong segment.

The family van segment is just not what buyers today are queuing up for. The Vista D90 is another move in the right direction, but these have been a bit too far and few in between.

The relevant point here is that Tata Motors’ in-house engineering talent and its global reach in terms of access to vendors and partners can easily enable it to develop a new class of vehicles fitting into the existing sub-brands that it has.

But it is probably better off creating new brand properties that can potentially better reflect the new quality aspirations of this new class of vehicles. Tata Motors can’t afford to repeat mistakes with branding, such as the ‘Indigo-Manza’ episode.

Jazz up the Nano

Perceived quality is a hugely influential factor in the car buying process. Nobody, not even those upgrading from two-wheelers, wants to be told that they are buying a compromise because that is what their budgets can fetch them.

Buying a car means satiating the owner’s ego first, before it meets his/her needs. This is regardless of the segment and applicable even to the world’s cheapest car.

It was a very noble thought for the Nano to be positioned as the people’s car — one that enables a family of four to travel in safely, compared with their current over-crowded two-wheeler.

But, even to these potential buyers, it just didn’t send the right message. In building the Nano to a price, there were too many errors made with perceived quality.

So, all the hype about the Nano being the world’s cheapest car didn’t work in its favour, at least in terms of sales volumes.

But, all those who were earlier reluctant to consider the Nano because their neighbour would have smirked at them, are now willing to try it out because of the new ‘younger’ advertising that Tata Motors has adopted.

Pitching it to the young and not stressing on its low-cost attributes has clearly helped the Nano. Most Nano drivers we see on the road today are in their 20s, and possibly single.

The Nano story has just begun, but now it needs to be taken to the next level. That should involve a progression in this whole process of making this brand ‘younger’. And that requires quickening the development of newer, more modern variations of the Nano.

There are convertible and trailer versions of the Nano that have been attempted independently by owners. By Tata Motors’ own admission, there is more being done by the owners themselves to the Nano than by the company.

Karl Slym, Managing Director of Tata Motors says that later this year there will be a new Nano — not a new generation though — with variations that will attempt to offer some surprise elements to the buyer.

A new global brand

Tata Motors should possibly also consider the merit of launching an all-new global brand. This is where concepts such as the Pixel and the Megapixel could come in.

The company should look at leveraging the platform like the one on which these concepts have been built for developing a globally relevant micro-car.

JLR’s expertise could be roped in for establishing a strong technology-oriented development and manufacturing structure for the new outfit. Else, Tata Motors should be open to the idea of partnering with another global automotive brand.

The purpose should be to create a brand with outstanding attributes in terms of quality, but it will still be within the purview of the strengths that the Tata brand has now come to be associated with: The hype surrounding the Nano made sure that Tata Motors became known for its prowess in building small cars.

The current slowdown may not be the best time to invest in a new brand, but it could fetch returns in the long run and, more importantly, positively impact Tata Motors’ image in India itself.

Also, if it could potentially also help Tata Motors tap into the European and Asian markets’ current slowdown-driven demand for small cars, it might just be worth the investment.

Group company JLR’s strong resurgence in the last three years has been largely attributed to the effects of the stand-out design of its latest products.

Tata Motors should take some cues from that success story as well.

Related Topics
comment COMMENT NOW