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  • Building An Auto Empire In India

    With a beginning price of $2,900, it is designed to lure India’s growing middle class away from their bicycles and motor scooters and into safe family-size, weatherproof vehicles. Nano got off to a rocky start but is gathering speed.

    Upstart: Global Business

    The Tata Nano gets 50 miles to the gallon and costs $2,900.

    The congested city of Mumbai is an unlikely base for an auto company with global ambitions. Motor vehicles on two or three wheels far outnumber those with four, traffic uncontrolled by signals or signs is perpetually snarled, and the occasional cow finds its way into the street. Nor is the modest colonial-style office building known as Bombay House that dates from 1924 an obvious home for a corporate headquarters. The ground floor could use a coat of paint. Entrance to the cramped, crowded lobby comes only after passing through a metal detector manned by uniformed guards.

    Calm breaks out on the fourth floor, however, where Ratan Tata, chairman of the Tata Group, maintains his office. White walls are hung with large, abstract paintings. A floor-to-ceiling window looks onto a balcony filled with plants. Tata, a tall, vital 73-year-old, is low-key and engaging. Educated at Cornell and Harvard, he is a worldly man; he serves on the board of Fiat, talks business with General Electric’s (GE, Fortune 500) Jeff Immelt, and shares helicopter stories with fellow pilot Bob Lutz of General Motors (GM). Although India is a late arrival to the automotive age, Tata is a lifetime car enthusiast who stays up on the latest industry chatter. “I love cars,” he confesses. “I was very sorry to see the Pontiac brand disappear; I was a great admirer of Pontiac.”

    As head of the Tata Group, which employs 395,000 people in 80 countries, Ratan Tata has wrought a remarkable transformation at the enterprise his great-grandfather founded in 1868. It encompasses 98 operating companies that, among other things, make steel and chemicals, provide information technology, own hotels, produce tea, and build cars. Tata Group’s revenues, $67.4 billion for fiscal 2010, have increased 12-fold since 1991. All of which helps explain why Tata lands at the No. 2 spot on our list of Asia’s most powerful executives, behind another auto magnate, Akio Toyoda.

    The road to international auto stardom

    The Indian car market is small — one-sixth the size of China’s — but growing just as fast. Tata wants to use its vast potential as a platform to transform Tata Motors (TTM) from a regional powerhouse into an international automotive player. In the past 24 months he has taken three audacious steps in that direction. First, Tata unveiled the Nano, which aspires to be nothing less than a people’s car for the developing world. With a beginning price of $2,900, it is designed to lure India’s growing middle class away from their bicycles and motor scooters and into safe family-size, weatherproof vehicles. Nano got off to a rocky start but is gathering speed. It could open big export opportunities that Tata hopes will eventually include the U.S. and Europe.

    Read More:

    http://money.cnn.com/2011/04/15/news/international/tata_auto_empire_india.fortune/index.htm

    Upstart: Business and Management for 20-40 Year Old Professionals

    Filed Under: Global Business

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