Tata Motors is developing a new line of fuel efficient vehicles to take "head on" competition from global brands like Mercedes-Benz, Volvo and Navistar in the Indian commercial vehicles market, the company's Chairman Ratan Tata has said.
"A new line of very competitive, fuel-efficient vehicles is being developed by Tata Motors to meet the competition head-on," Tata said in the company's annual report for 2011-12.
Commenting on competition from global brands, he said: "In the coming years, Tata Motors' predominance in commercial vehicles will be challenged by the entry of international brands like Mercedes-Benz, Volvo and Navistar, which have all entered, or are in the process of entering India."
In the fiscal 2011-12, Tata Motors had a market share of 58.45 per cent in the Indian commercial vehicles segment which stood at 8,09,532 units. The company was followed by homegrown rivals Mahindra & Mahindra (15.69 per cent) and Ashok Leyland (11.01 per cent).
In the car segment, despite the initial struggle, the company's small car Nano would continue to gain traction in India, while "the potential market for such an affordable car is enormous throughout the developing world", he added.
"In passenger cars, Tata Motors will face even greater competition from the many automotive brands that are in the country," he said.
Tata, who is set to retire as the Chairman of the $ 100 billion conglomerate this December, said Tata Motors will need to address the marketplace more effectively with its existing and future products in order to regain the level of market share that it earlier enjoyed.
On the Nano, he said: "The fundamental economies of the Nano, which was globally acclaimed when it was unveiled in 2008 and which was plagued with start-up roadblocks in the state of West Bengal, will continue to establish itself in the Indian market with a wider sales and service network."
Bullish about the car that was once touted as the world's cheapest, he said: "The potential market for such an affordable car is enormous throughout the developing world."