Tata Indica - The Making Of The Small Car
 <<Previous
THE STORY OF INDICA
In the early 1990s, Telco's Chairman Ratan Tata (Tata), was flirting with
the idea of developing a small car. By mid-1994 a rudimentary design was in
place. In 1995, Telco announced that it planned to build a car which would
be priced close to the Maruti 800, shaped like the Zen, and spacious as an
Ambassador.
|
Producing the new small car – Indica – represented a different kind of
challenge for Telco. Should Tata succeed, he would change the face of
Telco. As a truck-maker, Telco was so integrated that it even made it
own castings and forgings. As an automaker, it would have to focus on
the value chain that stretched between raw materials and after-sales
service as well as assembling the parts into the complete automobile.
For its new venture, Telco outsourced 80% of the components (1,200 of
its 1,500-plus parts), from 200-odd vendors. To develop the Indica,
Telco had to combine the learnings from its predecessors with its own
unique supply chain management strategies to ensure a sustainable
low-cost platform. |
|
By learning to build and manage a supply chain, it would
set the ground for leveraging the capabilities of the automotive
component-manufacturers who already operated in its target markets. In other
words, Telco planned to use its skills as an integrator--bringing together
products and services from both upstream and downstream operations, and
packaging them for the customer under a brand name in its new venture.
Globally, a car could be built in 48 months with an investment of US $ 3
billion (Rs 127.5 billion). Indica, was built in 31 months on a budget of Rs
17 billion. This seemed to have been possible by focussing on the supply
chain.
THE OUTSOURCING STRATEGY
VENDOR DEVELOPMENT
SUPPLY CHAIN
LEVERAGING THE SUPPLY CHAIN
QUESTIONS FOR DISCUSSION
2010, ICMR (IBS Center for Management Research).All rights reserved. No part of this publication may be
reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted
in any form or by any means - electronic or mechanical, without permission.
To order copies, call +91- 8417- 236667 or write to ICMR,
Survey No. 156/157, Dontanapalli Village, Shankerpalli Mandal,
Ranga Reddy District,
Hyderabad-501504.
Andhra Pradesh, INDIA.
Ph: +91- 8417- 236667,
Fax: +91- 8417- 236668
E-mail: info@icmrindia.org
Website: www.icmrindia.org
|
More Classifications...