Tata Motors: Stepping into Passenger Vehicles and Ratan Tata's Vision (P-2)

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 The latter half of the 2010s and early 2020s marked a period of remarkable turnaround for Tata Motors, driven by strong leadership and strategic foresight.


The Era of "Chandra and Chandra"

  • The era of Chandra and Chandra: This refers to the impactful collaboration between
     N. Chandrasekaran (Chairman of Tata Sons) and Shailesh Chandra (MD, Passenger Vehicles).

    • Financial Turnaround: Chandrasekaran, though not a "car guy," brought a "dispassionate view" and strict financial discipline. Alongside CFO P.B. Balaji, he professionalized the passenger vehicle business, which was previously considered a "spoiled child" with lax financial oversight. This led to a dramatic financial turnaround: from a consolidated group loss of over ₹10,000 crore in a year to a profit of over ₹27,000 crore (and even ₹32,000 crore in FY24). The PV business specifically saw its monthly volumes more than triple from ~12,000-13,000 units (1.6 lakh per annum) before COVID to over half a million vehicles per annum.

    • Shailesh Chandra's Role: Shailesh Chandra's agility during the challenging COVID-19 pandemic and the semiconductor crisis, along with his ability to "galvanize the whole company" and motivate dealers, was crucial to this success. He was rightfully awarded "Autocar Pro Man of the Year."

Strategic Partnerships and Post-COVID Surge

  • Partnerships: While the Chinese alliances for the "Creta fighter" didn't materialize, Tata Motors has a history of strategic collaborations. The joint venture with Fiat (now Stellantis) has proven remarkably resilient due to contractual agreements making exit prohibitively expensive. This long-standing relationship was highlighted by John Elkann (from the Agnelli family of Stellantis) attending a tribute for Ratan Tata.

  • Post-Covid rise: The "forever new" product strategy, implemented just before COVID-19, ensured that Tata Motors had the "freshest portfolio" when the market reopened. This, combined with smart management of the semiconductor crisis, propelled Tata Motors into a period of "dream run" from October 2020 to 2023.

Securing the Future: Funding and Capacity

  • Raising funding: A "masterstroke" under Chandrasekaran was the ability to raise significant funds from the market, including the $9.1 billion valuation for its EV subsidiary (TPG Rise Climate investment). This demonstrated immense market confidence and reduced the need for external partners to share development costs.

  • Capacity Expansion: Tata Motors has significantly invested in manufacturing capacity, acquiring Ford's Sanand plant. Today, they have a capacity of close to 1 million units per annum, allowing them to focus on new products to fill this capacity.

  • Financial Health: The company cleared its debt of approximately ₹60,000 crore and is now "net cash," with its existing business generating profits that can be reinvested.


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