New Delhi: Expecting revival of fortunes at its automotive arm Tata Motors, Tata Group chairman Cyrus Mistry today said "green shoots of a turnaround" are visible at the country's largest automaker.
While admitting that challenges continue to exist in both parts of the business, particularly in passenger cars, Mistry said in order to address all of the challenges the company has identified eight strategic imperatives.
"We identified eight strategic imperatives and set up over a hundred cross functional teams, comprising executives from various levels in the organisation, but especially designed to ensure we gave an opportunity to our young leaders to shine," Mistry said in an in-house interview on the company's website.
"The strategy has paid dividends. The energy demonstrated by the teams and the results of their efforts have been incredible. Our journey has just begun, but we can already see the green shoots of a turnaround," he added.
For the first quarter ended June 30, Tata Motors had reported 57 percent decline in consolidated net profit at Rs 2,260.40 crore due to post-Brexit adverse foreign exchange impacting its British arm JLR.
On a standalone basis, the company had reported a net profit of Rs 25.75 crore for the first quarter, down 91.11 per cent from Rs 289.84 crore in the year-ago quarter.
Mistry said that while reviewing the passenger car product plan, it was evident that the company had challenges in aspirational design, platform strategy, and an over-reliance on diesel power trains.
"These contributed to challenges in brand perception and the health of our dealership network. Product and service quality were areas that needed strengthening," he added.
He said that besides these challenges "the strength of Tata Motors lay in its people".
"We worked on multiple fronts to strengthen internal capabilities, and some of this work is beginning to bear fruit," Mistry said.
He added that competitive landscape has changed significantly over the last five years in the automotive field.
"New original equipment manufacturers (OEMs) have entered the market with contemporary products developed on lean platforms that are engineered for cost and weight. We have seen the launch of more than 50 new passenger cars," Mistry said.
Similarly, in commercial vehicles strong global competitors have made large investments at a time when the market itself is falling, he added.
"We have a rich pipeline of innovative products that I am confident will redefine Tata Motors in the future," Mistry said.