Almost a year after announcing its intention to enter the Indonesian market and forming the wholly-owned subsidiary PT Tata Motors Distribusi Indonesia in Sep 2012, Tata Motors Limited (TTM - Snapshot Report) recently launched three cars in the market. The company has selected Tata Aria, Tata Vista and Tata Safari Storme after extensive research on the needs of the Indonesian consumers.
Tata Motors also launched 5 Sales, Service and Spare Parts dealerships in the country, with plans to launch 4 more by year-end and 6 in the first quarter of 2014. Further, the company launched its 24x1 parts program in Indonesia, which promises to supply any part within 24 hours and will provide the part free of cost in case of failure to supply within the timeframe.
Tata Motors also plans to open 40 workshops in Indonesia with trained personnel and equipment by Mar 2014. The company believes that the Indonesian market offers significant growth opportunities and hopes to establish a strong foothold in the market.
The three cars launched by Tata Motors aim to meet the requirements of different customers. While Tata Aria Pure 4x2 is India’s first multi-purpose vehicle (MPV) crossover, Tata Safari Strome is a sturdy SUV. Both the cars run on diesel. Tata Aria has the looks of an MPV with the performance of a sports utility vehicle (SUV), which is expected to be popular in Indonesia.
Meanwhile, Tata Vista GZX is a gasoline-powered hatchback that combines style and sturdiness with fuel efficiency and affordability. Tata Motors plans to launch more vehicles in Indonesia soon.
Tata Motors currently carries a Zacks Rank #3 (Hold). Other foreign automakers worth considering are Nissan Motor Co. Ltd. (NSANY), Fuji Heavy Industries Ltd. (FUJHY) and Volkswagen AG (VLKAY). All these companies carry a Zacks Rank #1 (Strong Buy).