Tata to tie up with local manufacuturer to enter Indonesian market

Tata Motors is just short of striking gold this time. The country’s leading car manufacturer is on the brink of signing a contract to develop its small car Tata Nano and a commercial vehicle Ace truck with a local manufacturing company. However, Tata India kept the cards pretty close to its chest and did not reveal any information on the financial aspects and the other party involved in the deal. The contract manufacturing makes all the more sense when the risks can be distributed among the two parties involved. Things have started looking even brighter now that Indonesia also has something interesting up on its sleeve.

  See More Tata Nano Pictures                                                                                    Read More on Tata Nano

Apparently, the country is encouraging the local car manufacturers to develop more small cars that are high on fuel efficiency. Basically, the country also has plans to provide incentives to promote the fuel-efficient small cars. So, obviously Tata Motors has a perfect plan brewing up in its mind as this is the exact break that Tata Motors need at this time. To dig out the actual root cause for this entire contract manufacturing set up, we will have to start the story from the beginning. Tata Motors is one of the manufacturers with high plans for improving its global presence. And the Greenfield manufacturing unit is one such move. Tata Motors had apparently thought of setting up an independent unit in Indonesia to produce the same Tata Nano and Ace truck. The plans for the same were on the pipe-line too.

  See More Tata Nano Pictures                                                                                    Read More on Tata Nano

They have even taken a step forward in the direction. They have started discussing the plans more in detail in terms of the product range which is expected from the new unit in Indonesia. But, logically thinking, local auto majors like Mahindra and Mahindra or even the OEMs like GM have plans to export the locally produced vehicles to other parts of the world. Then isn’t Tata India’s Indonesia move a little contrary to what M&M and GM are implementing?  What more, the Tata Nano small car hasn’t proved to be the success that it is expected of. The auto major wouldn’t require a lot in terms of investment, if they strike the deal with a local manufacturing company to do just about the same what the Greenfield unit could do. Most probably, by the second half of 2012 is when the project is likely to go live. This means, not until the beginning of 2013 that Tata Motors will see its small car Nano and Ace rolled out from its partner. Overall, 100,000 units of Nano and Ace are expected to be developed in the initial lot.

Read More on : Tata Nano