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Tata Motors expects exports to contribute 20 per cent to commercial vehicle business

The company is looking to strengthen its position in SAARC, Middle East, Africa and ASEAN countries and will invest Rs 1,500 crore in the category

Tata Motors, which has earmarked an investment of Rs 1,500 crore in its commercial vehicles (CV) business, is looking at a 20 per cent contribution to its business in this category from exports. The company, which is seeing a revival of the market after an initial dip in sales, is looking to strengthen its position in markets such as SAARC, Middle East Africa and ASEAN countries.

R T Wasan

“Tata Motors’ international expansion strategy involves entering new markets where we have an opportunity to grow and introduce new products in our existing markets to further consolidate our presence in such markets. Keeping in line with this strategy, we are committed to expand our presence in the ASEAN countries, where in the recent years we entered Vietnam, Indonesia, Malaysia and the Philippines,” said R T Wasan, Vice-President, Sales and Marketing, Commercial Vehicle Business Unit.

After facing a dip in the first quarter of the ongoing fiscal year, Tata Motors saw a 24 per cent increase in the sales of its commercial vehicles business in the months of July-August, after experiencing a drop of 15.62 per cent in Q1 of the current financial year. The company’s commercial vehicles business that held 44.5 per cent market share in July saw it rise up to 45.6 per cent in August.

The dip in the first quarter can be attributed to a lot of things such as demonetisation, the transition from BS III to BS IV norms, and the GST regime. But with the festive season here, the numbers are expected to show an upward trend.

“After a sluggish Q1, the CV segment has seen an uptick in July and August sales towards greater recovery on the back of improving sentiment, streamlining of production of OEMs and upcoming festive season,” said Wasan.

With Tata Motors’ domestic CV market business pegged at about 80 per cent of which approximately 11 per cent is buses, the company has taken an aggressive growth plan for the business.

Tata Motors has already launched and lined up over 20 different products for launching across segments, including the medium and heavy commercial vehicles side (M&HCV), the intermediate and light commercial vehicles (ILCV) segment, the pickup segment and the CV passenger segments for the FY 17-18.

“We will be investing Rs 1500 crore in our CV business primarily focusing on new product developments, tooling required in manufacturing along with some investments towards sustenance in manufacturing plants. With the widest range of commercial vehicles in the world, we have recently introduced a new exciting range of Ace XL series of small commercial vehicles,” said Wasan.

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