Tata Motors announced that it will focus on micro-segments with relatively higher growth prospects in FY21, and is currently preparing to ramp up BS-VI production at its five plants across the country.
It added that it will concentrate on segments that are likely to grow better vis-a-vis cargo haulage.
"We see a few segments which are coming up, the first one is tippers (compared to the cargo range of vehicles) in M&HCVs. We also see good demand coming for e-commerce, petroleum oil and lubricants segments, and transportation of horticulture and dairy produce. We are focussing on these micro-segments to build our demand pipeline", Girish Vagh, Head, Tata Motors' Commercial Vehicle Business told analysts in a conference call.
Wagh further noted that the CV maker grew market share in M&HCVs for the second consecutive year in FY20, after a downtrend of almost a decade. The company had last grown market share in M&HCVs in FY10.
Tata Motors has, moreover, increased its focus on the non-vehicle or after-sales business as the country opens up after several weeks on a nation-wide lockdown. According to Wagh, workshop and spare-parts revenue for the auto-makers is surging back to pre-COVID levels.
Wagh added that the company was making strong strides to work on cost reduction, and significant targets have been set across all cost-heads. Tata Motors will also significantly cut down capex this year, as it made heavy investments to support the BS-VI transition and develop new product propositions over the last couple of years.
Going ahead, the company will focus on the second phase of its BS-VI transition.
On the demand-fulfillment side, Wagh said "The transition to BSVI has happened and we have started producing BS-VI vehicles. We are tracking supplier ramp-up too. We have been tracking 1000 suppliers within the country to ensure a smooth ramp up, and more than 95 percent of vendors have started working. We are in a good stage for ramping up BS-VI production. We will be in a position to supply the pipeline we generate."
Currently, all of the company's 5 commercial vehicle plants in the country are operational. The plants started opening up since May 18, and are working with nearly 30 percent manpower.
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