Tata Motors suspended production at Pimpri for the second time in 2 months to clear inventory levels
Tata Motors has stopped production of cars at its Pimpri factory, off Pune as the demand slump in the Indian car market continues. Car sales in India have witnessed a steep fall for the past few months due to various factors like high interest rates, high petrol prices and a general slowdown in the Indian economy. Discretionary purchases like cars have been put on the back burner by potential buyers and this has resulted in car sales falling across car makers. Tata Motors has been hit particularly hard by this slowdown in sales.
Tata Motors has suspended production for the second time in as many months at Pimpri. The four day closure of the plant begins today and will go on till the 4th of August, 2012. The cut in production will allow Tata Motors to clear piled up inventory as dealers struggle to sell cars. While the general slowdown in the economy has been largely responsible for a sales slowdown across car makers in India, Tata Motors has been more affected than the rest despite having a number of diesel engined models. Even so, the Indian car and utility vehicle major has been unable to take advantage of the shift in demand from petrol to diesel cars.
A prime reason for this is an ageing and uninspiring portfolio that needs urgent refreshing to keep the buzz around Tata cars alive. Though Tata has a presence in almost every segment under INR 20 lakhs, none of its cars have been segment leaders. While the Nano has been clobbered in the entry level car segment due to the car being available in petrol only guise, the Indica and Vista models now appear very dated, especially in the face of newer competition. The same story runs across other Tata car models like the Indigo, Manza, the Safari and the Aria.
Even the Venture, which is a well priced passenger van, has failed to click, resulting in Tata Motors having no best seller in any segment with even the Sumo MUV being bested by the Bolero range from Mahindra. So, Tata Motors needs new products that can actually go on to become best sellers in their respective segments rather than also-rans, as is the case currently. The next big launch from Tata is the Safari Storme SUV, a product with which the automaker would hope to reverse its sagging fortunes.