Tata Engineering & Locomotive Ltd (TELCO) is firming up plans to market the Indica (small car) in international markets. This was reported by a leading financial newspaper.
Telco is India's largest medium/heavy commercial vehicles (M/HCV) (65% market share in August 1999) and light commercial vehicles (LCV) (63% market share) manufacturer. It also manufactures utility vehicles - UVs (28% market share) and small cars (7% market share).
After having made an impact in the domestic market with the Indica, Telco is now eyeing the export market and has outlined aggressive plans to push its small-car. As yet, the company has not finalised any overseas marketing tie-ups, but is open to one. Currently, Telco has its own marketing network in Europe to market the Safari, Estate and Tatamobile (all UVs).
Other small car manufacturers, Maruti (Zen) and Daewoo (Matiz) have already adopted the export route, and have met with a fair degree of success. This seems to underline demand potential for quality Indian passenger cars. This fact will not be lost on Telco when it markets the Indica in FY2000. Indica's has already generated some interest with its looks in European and Asian countries.
However, the going will be far from easy for the Indica. Apart from local competition (Maruti), it will also have to contend with international manufacturers (Daewoo, General Motors, Fiat). These companies already have established marketing networks across several countries and have the financial muscle to withstand competition. Moreover, so far Telco has got recognition only for its UVs in export markets and it will be awhile before it can boast about its small car.
Analysts have flagged a 'BUY' on the company largely due to its restructuring efforts to hive off its auto components division. Rising CV demand and Indica's impressive performance are other factors that have found favour with analysts.
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