Highway Jottings-10
“I am hungry. Can we halt for breakfast?” asked Selvan Dasaraj on the Chennai-Bengaluru highway (NH48) after we crossed the Saint Gobain factory on a road trip some time ago. Besides him and yours truly, Selvan’s spouse, Indira and her elder sister, Latha, were co-passengers in the white Mahindra Scorpio.
“Look for Murugan Idli Shop (MIS),” suggested Latha.
Indira quipped: Hope we get other stuff also … like idiyappam, dosa, upma, poori urulai kizanghu vagera vagera.”
Soon, our vahan found an MIS joint on the left side of the highway, and Selvan took time to park as the yard was packed.
Ellam kidaikkum (you’ll get everything), responded Selvan, leading us into the crowded restaurant.
Though MIS branded itself as the restaurant for idli (steamed rice balls, the most popular south Indian fast food), it did serve everything under the sun — vegetarian items only. But idli was its speciality, with the South Indian gun power, gingelly oil (the best accompaniment), chutneys, and sambar; the restaurant cannot bank on just a single item. For its business to sustain and prosper, MIS has to offer as many items as possible to cater to a wide clientele. Sure, such an approach makes good business sense.
The conversation at MIS took on a new meaning when I read the profound words of Tata Sons Chairman Padma Bhushan Natarajan Chandrasekaran, shared with his shareholders at the recent Tata Motors Annual General Meeting.
What did he say?
“India is well on track to exceed the 5 million vehicle sales mark in passenger vehicles over the next few years from the 4.1 million volumes clocked last year. India’s vehicle penetration, at about 30 vehicles per 1,000 population, is well below global norms and is expected to continue to increase.
The PV business will continue to invest in products, platforms, electrical and electronic architectures, and vehicle software to remain competitive. The business will also focus on significantly improving customer experience and product quality. The EV business will focus on driving up penetration through multiple product launches, focus on market development, charging network enhancements and continuing to introduce aspirational product features.”
Tata Motors will focus on vehicle parc-linked businesses to reduce the volatility of commercial vehicle sales. Apart from vehicular sales, the business will also focus on vehicle parc-linked businesses like spares and digital and smart mobility solutions, which will help reduce the volatility of the vehicle sales business. This should help drive consistent value-accretive growth in the coming years.”
Let’s delve deeper into Tata Motors’ strategic vision. It’s not just about being an automotive major producing passenger and commercial vehicles. The company is looking beyond pure vanilla truck and passenger car manufacturing. This is a testament to Tata Motors’ strategic foresight, as Chandrasekaran emphasized vehicle parc-linked businesses like spares and digital and smart mobility solutions. These ventures are not about making motorized vehicles but are intricately related to its core business. We can call it ‘scope creep,’ a term that aptly captures the company’s forward-thinking approach.
Finding an authorized Tata Motors dealer or mechanic workshop for truck drivers’ repair was challenging two decades ago. Not that they weren’t there, but they were very few in number. Many roadside mechanics mostly attended to the needy truck drivers.
Today, the scene is different. Many have sprouted. Unlike the self-taught, unorganized Road Side Mechanics (RSM) catering to the various demands of truck drivers, these authorized showrooms are manned by a trained workforce by OEMs with better equipment and paraphernalia to attend to repairs.
Consider the vast potential of the After-Sales Service and after-market sectors. Genuine spare parts outlets, Annual Maintenance Contracts, Guarantees, and Warranties are all part of a customer-centric business model. OEMs primarily focused on sales in the past, but now they are looking beyond, demonstrating Tata Motors’ commitment to customer satisfaction.
Why? As Chandrasekaran explains, it’s to ‘help reduce the volatility of the vehicle sales business. This should help drive consistent value accretive growth in the coming years.’
As the era of EVs dawns, Tata Motors is positioning itself as a leader, whether it’s in the PV or CV segment. These vehicles require a different level of expertise that Road Side Mechanics (RSMs) can’t provide. However, Tata Motors recognizes the importance of RSMs in the industry and is encouraging their development through training. This ensures a strong support system for EVs, reflecting Tata Motors’ commitment to the future of mobility.
Again, with the mobility bug biting the transport stakeholders, OEMs have jumped in with their concoction or cocktail of digital services under the garb of optimizing the Total Cost of Ownership (TCO), another revenue generation source. The sale of a truck or PV may be a one-off deal, but maintenance of PV or CV through its lifetime (at least ten years) is a regular source of income.
That’s what the Tata Sons chairman was saying.
