Tata Motors consolidating supplier base

Tata Motors consolidating supplier base

Tata Motors is one of the most successful automakers in the Indian market. They are dominated by players like Maruti and Hyundai of course, but they still sell cars like Indica and Indigo in large numbers. However, the company normally falters at one thing, which is quality in the components of their products. The company plans to fix this and now aims to consolidate their vendor base.

The company has said in a statement that they are in the process of ‘shrinking’ vendor base as part of a ‘strategy’ to rationalize supplier chain. Tata Motors Managing Director Ravi Kant was speaking at the launch of their new commercial vehicle ‘Tata Novus’: “We are looking at shrinking our supplier base by filtering out low quality suppliers.”

Tata is looking at identifying some of the key vendors and plans to continue to work with them. As for their latest offering, they have used the expertise of its South Korean subsidiary Tata Daewoo Commercial Vehicle Co. Tata formed this company after they took over the Daewoo Commercial Vehicle Co. in 2004.

Tata also said that they are seeing an improvement in their export sales as the company is now targeting newer markets with their product range. Kant said about the company’s export policy: “Exports for us have been growing and should increase further. They are expected to be 17 per cent in value terms for us now against less than five per cent 3-4 year back. As much as 40 per cent of the production from Korea is being exported.”

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