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Old 5th June 2014, 22:08   #1
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Default Why Tata should tie up with Mazda

Tata and Mazda - unlikely names, but if you look closely, they have fairly complementary product lines and could help each other immensely.

Let's start by examining both manufacturers independently before looking at why working together would make sense

1. Tata Motors Group - Just coming out of a very eventful decade, in which they bought and turned around Daewoo Commercial Vehicles, Jaguar Land Rover; launched the world's cheapest car and continues to hold a major share of India's CV market despite world class competition. If there's one dark spot in Tata Motors, its the local passenger vehicle business - essentially the cars, mini vans, MUVs and SUVs - which have practically been treated like the proverbial middle child in a family of superstars.

Tata has been desperately trying for a couple of years now to reverse the decline in sales of their cars / SUVs by introducing facelift after facelift, but this is just resulting in CAPEX, with no sales increase.

I believe Tata may not really have the know how to produce a niggle free, 'desirable' car at VFM prices that the average person on the street wants to buy. One just needs to look at Maruti and Hyundai to understand what's needed, not necessary that you'll learn how its done.

This is where Mazda comes in.

2. Mazda - one of the few independent auto companies in the world, renowned for producing exactly what Tata is lacking or wants....desirable VFM cars. Everyone remembers the Mazda MX5/Miata and how it changed the sports car world for ever.
For a long time Mazda was in a JV with Ford (who owned quite a bit of Mazda), but is now completely on its own.

Currently, Mazda is on a high, with a number of its cars - 3, 6, MX5 all being praised for their design, driving dynamics etc at VFM prices. The Kodo design language and SkyActiv engine tech are highlights as well

If we look at the market positioning of Tata and Mazda, you have
1. JLR at the premium segment
2. Mazda in the entry level premium segment
3. Tata in the economy segment

Surely there are synergies to be had here by combining the best of Tata and Mazda? Tata/JLR could leverage some of Mazda's technology and production expertise and Mazda can leverage some of the premium/cachet of JLR and get an entry into India via Tata. A WIN -WIN situation and produce a true world class auto group.

Thoughts?

Last edited by prashanthyr : 5th June 2014 at 22:12. Reason: added content
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Old 6th June 2014, 14:16   #2
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Default Re: Why Tata should tie up with Mazda

Thread moved from the Assembly Line (The "Assembly Line" Forum section) to the Indian Car Scene. Thanks for sharing!
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Old 6th June 2014, 14:26   #3
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Default Re: Why Tata should tie up with Mazda

Quote:
Originally Posted by prashanthyr View Post
I believe Tata may not really have the know how to produce a niggle free, 'desirable' car at VFM prices that the average person on the street wants to buy.
Actually they do -- the Ranjangaon factory produces niggle-free Fiat cars, why not niggle-free Tata cars? In fact the Vista and Manza (produced at that factory) are very good, by all accounts, but Tata has damaged its reputation for reliability so badly with the other products that I think it will take a long time to recover. The one thing a JV with Mazda can bring in is the credibility associated with the name, but only if the cars are badged as Mazda!
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Old 6th June 2014, 14:28   #4
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Default Re: Why Tata should tie up with Mazda

I too was under the impression that Ford owned Mazda. But just checked and it looks like they don't have a stake in Mazda anymore.

Yes, it would bring well packaged, reliable, reasonably priced cars into Tata showrooms. Mazda can leverage Tata's distribution network and Tata can learn a few things from Mazda on packaging and customer satisfaction.

Well, if wishes were horses, we'd be betting on Citroen coming in as well.
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Old 6th June 2014, 15:06   #5
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Default Re: Why Tata should tie up with Mazda

Fiat is already collaborating with Mazda for the Miata replacement, a version of which Mazda will build for Fiat (and Abarth?). Coming in a year. There are speculations even in the Japanese press about Fiat maybe tying-up somehow with Mazda and/or Suzuki on a big, strategic scale.

Tata then necessarily comes into the picture because of the Ranjangaon JV with Fiat, which is profitable. Does Mazda have any product that would work at Indian prices? And would Tata pour resources into c2 to d2 segment products (Mazda) when they're trying to sink their teeth into the real meat of the market (B and C segments, with the Zest and Bolt? A tie-up with a big Chinese manufacturer is likelier, since presumably a chinese car company will supply cash and not just tooling and dies for cars.
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Old 6th June 2014, 16:02   #6
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Default Re: Why Tata should tie up with Mazda

Yes, I think Fiat is looking at the Miata as a base for an Alfa Romeo sports car...

Coming back to my suggestion for a Tata - Mazda tie up, some other arguments in favor of this tie up are
a. The car industry is notoriously capital intensive with very little margins (JLR/Porsche are exceptions)
b. Most manufacturers - even the financially sound ones are tying up with even competitors(!) to share engines, platforms and even complete vehicles - did you, for ex know that VW sold a re badged MB Sprinter in Europe? or that the MB Citan is a re-badged Renault Kangoo? Toyota and Subaru have collaborated on the GT86/BRZ twins and Toyota is going to get a version of the SkyActiv engine from Mazda. Closer home, we have Fiat engines powering everything from Fiats to Chevys, Tatas and Marutis..

Given this scenario, Tata definitely needs a long term partner with whom they can share costs and leverage strengths. I am not in favor of a Chinese tie up as they really dont have the technology or branding required to succeed.
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Old 6th June 2014, 20:30   #7
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Default Re: Why Tata should tie up with Mazda

I dont think Mazda -Tata tie-up at this juncture will hold much.

We have seen Tata-Benz and Tata-Fiat at the the passenger car level fail. I guess only the Tata-Marcopolo bus JV is holding up.

Tata needs to create a better image in the hearts of people before they can start selling stuff. I fear that Mazda would do better if they independently enter india like Audi / BMW and similar rather than JV with tata.

At the very least, Mazda would be serviced at a Tata delaership and that it self would be a deterrent for a prospective buyer.
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