Reference Auto

With Ratan Tata exiting the mighty Tata empire, we have had a non-Tata, Cyrus Mistry, at the helm but will the Tata Group take a big leap with Cyrus just like it did with Ratan?

Ratan Tata had literally transformed the group after he took charge from his uncle, the legendary JRD Tata. During JRD’s time, the Tata empire was mainly confined to Tata Steel (earlier known as Tisco) and Tata Motors (known as Telco before) with a few subsidiaries here and there.

Also, during the time of JRD, Telco was basically a heavy vehicle maker, that is, it made trucks and buses. But after Ratan took over, Telco saw a sea change besides a change in its name.

Tata Motors started manufacturing the Indica, and with it, the company forayed into the making of passenger cars.

Since then, it has gone a long way. It then started making cars such as the Indigo, the Indica Vista and the Indigo Manza.

Notably, Ratan Tata became even a bigger name after he launched the people’s car, the Nano, for Rs 1 lakh.

But to his dismay, the Nano was somewhat jinxed. There were a slew of fire incidents, which cast a shadow on the car, seeing its sales plummet like never before.

It took a while for Tata Motors officials to realise this blunder and rectify the fault in its new Tata Nano (the 2012 model that is), the price of which is Rs 2 lakh now.

Another factor that came as an impediment to Nano’s sales was the stigma attached to it for being the cheapest car. People became cynical of others, who owned a Nano.

Now, with a refurbished (a bigger and more powerful) Nano on cards, Tata Motors hopes to garner a big chunk of the car market under Cyrus. But will it?

Tata Motors also achieved another milestone under Ratan Tata. It brought British iconic luxury brands Jaguar and Land Rover and turned out to be a company to reckon with around the globe.

Similarly, another Tata company, Tata Steel, also acquired Anglo-British company Corus Steel, and with it, Tata Steel became the sixth largest steel manufacturing company in the world. A big feat!

Also, under Ratan Tata, another company Tata Consultancy Services or TCS was set up and this gave the Tata Group its biggest boost. Soon after and even today, TCS remains the biggest software company in India.

So, with Tata gone and Mistry leading the Tata empire, India’s competitive business environment poses a big challenge for the Tata Group, especially after the second set of reforms got a fillip after approval of foreign direct investment in retail.

More importantly, Cyrus will have to become a charismatic leader as Ratan Tata and unless he can achieve a brand name for himself like Ratan, the Tata Group may be affected adversely.

He will have to coordinate between Bombay House (where Tata’s parent firm Tata Sons is located) and other group companies, and if he does it well, the Tata Group will take a giant leap.

So, with Ratan Tata retiring, will Cyrus take the group to its next stage of growth?