Tata Motors MD Butschek writes letter to employees about crisis, says ‘it’s time to deliver’

Tata Motors spokesperson said that the company is now aiming for a turnaround in operations involving cost cuts and sales promotions

By:Updated: Jul 17, 2017 11:50 AM

Tata Motors MD Guenter Butschek, in a recent letter, urged employees to move over from a “transformation journey to a turnaround ambition,” while emphasising that the country’s largest truck manufacturer is undergoing a ‘crisis situation’, reported ETAuto. He explained that the company’s commercial vehicles (CV) division needs to be revamped. Butschek noted that it was now ‘time to deliver’, adding: “The performance of the CV business, which is the backbone of our company in terms of profitability and revenue, is really worrisome, as we have lost market share in all segments.” The financial year 2017 was not a good year for Mumbai-based Tata Motors as it closed with a total loss of Rs 2,480 crore. FY2018 too has not had a great start with a low truck sales performance. Even in terms of vehicle volumes, Tata Motor’s CV volumes only increased by 0.8%, whereas the industry standard growth was at 4%.

A Tata Motors spokesperson told ETAuto that the company is now aiming for a turnaround in operations involving cost cuts and sales promotions, while also working on a new range of products. The spokesperson went on to admit that Tata Motors could not read the market properly or provide new products according to it.

The company’s focus is now to be shifted to cost cuts in all cost categories and reestablishing the lost market share. “Our business plan is going to be extremely demanding with stretched targets, in terms of sales/market share and financial performance,” the MD said in the letter.

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Tata Motors’ performance in the next three-six months will be the most critical, correcting sales techniques, developing new products and streamlining supply issues. “This means that it will not be business as usual; it needs disruption. It requires a single minded obsession to deliver excellence and win back our leadership in the market place,” Butschek said.

Source: ETAuto

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