Tata Motors increases focus on ASEAN region

Mumbai, September 10, 2013: A year after setting up a wholly owned subsidiary -- PT Tata Motors Distribusi Indonesia (TMDI), Tata Motors has entered the Indonesian automotive industry with the launch of three passenger vehicles -- the Aria, Vista and the Safari Storme. These three models, the company feels, are good to meet the growing demand among Indonesian consumers of contemporary, next-generation car offerings, seven-seat crossover variants, and tough, durable SUVs.

“Since we made the announcement to enter this market a year back, we have tested various products across Indonesian terrain and are convinced that we are bringing in the right product mix, offering smart solutions for mobility to our Indonesian customers,” says Karl Slym, MD, Tata Motors.

Tata Motors has started its Indonesia business with five 3S dealerships, and will add four more by December. “Apart from these set ups, we are setting up around 40 additional workshops by March’14 which will offer customers service almost at their door steps,” says Biswadev Sengupta, president director of PT TMDI. He also adds that the company will come out many more products “very soon”.

Indonesia is increasingly becoming one of the most promising emerging markets and Tata Motors sees an immense potential for growth here. A recent Ricardo Strategic Consulting study has predicted that BRIC automotive markets will be eclipsed by the ‘Rising-15’ markets of which Indonesia is a part.

Tata Motors’ announcement for the Indonesian market comes a day after it formally started announced its commercial vehicles business in another ASEAN market – Malaysia (which is also in the ‘Rising-15’ markets). The Indian major has joined hands with DRB-HICOM, Malaysia’s biggest conglomerate, for the import, distribution and assembly of Tata Motors Commercial Vehicles in Malaysia. The agreements will enable DRB-HICOM via USF-HICOM to become the exclusive distributor of selected Tata commercial vehicles, as well as expand its vehicle assembly business and distribution network in Malaysia. Meanwhile, the Importation Agreement (IA) will enable DRB-HICOM via DHAS to become the exclusive importer and logistics service provider for Tata Motors’ Completely Knocked Down (CKD) and Completely Built Unit (CBU) vehicles in Malaysia.

“One of the key parts of our business is the importance of our partnership with DRB-HICOM, which will not only help us service this market well, but also play a significant role in ensuring that we are listening to our customers,” says R T Wasan, head, International Business, Commercial Vehicles, Tata Motors.

The new developments reflect Tata Motors’ focus on building its international business. However, the company will not enter markets where the prospect for success is less. It may even exit markets where it doesn’t see a scope to be a significant player, which in other words may mean being among the top three players in every market.