Global brands to challenege Tata Motors's dominance in commercial vehicles segment: Ratan Tata

The dominance of Tata Motors in commercial vehicles (CV) market will be challenged by the entry of global brands like Mercedes-Benz, Volvo and Navistar, Ratan Tata, chairman, Tata Group , has said.

"However, the company is developing a new line of fuelefficient CVs to meet the competition head-on," he told shareholders in the firm's annual report for 2011-12 in New Delhi on Friday.

"In the coming years, Tata Motors' predominance in commercial vehicles will be challenged by the entry of international brands like Mercedes-Benz, Volvo and Navistar, which have all entered, or are in the process of entering India". But Tata added that the firm was prepared to meet the challenges with new and better products.

In the fiscal 2011-12, Tata Motors had a market share of 58.45 per cent in the CV segment with 8,09,532 units. The firm was followed by homegrown rivals Mahindra & Mahindra (15.69 per cent) and Ashok Leyland (11.01 per cent).

On the passenger cars segment, in which the company has been struggling to stamp its authority, Tata said that the competition would be even greater. "In passenger cars, Tata Motors will face even greater competition from the many automotive brands that are in the country," he said.

Tata, who is set to retire this December, added that Tata Motors will need to address the marketplace more effectively with its existing and future products in order to regain the level of market share that it earlier enjoyed.

On the Nano, Tata said, "The fundamental economies of the Nano, which was globally acclaimed when it was unveiled in 2008 and was plagued with start-up roadblocks in the state of West Bengal, will continue to establish itself in the Indian market with a wider sales and service network."

Bullish about the car, which was once touted as the world's cheapest, he said, "The potential market for such an affordable car is enormous throughout the developing world."

Tata has not given up hope on the small car saying it has enormous potential throughout the developing world. He said that in 2011-12, sales of the Nano rose over the previous year though the overall passenger car sales of Tata Motors were below expectations.

On Friday, the chairman also said that Tatasowned British subsidiary Jaguar Land Rover (JLR) would launch a number of fuel-efficient sports cars in the next two years.