Tata Motors cruises past Honda, becomes country's fourth-largest car player

Has 5.33% share in India - the fifth-largest passenger vehicle market where 3 million units are sold annually

Tata Motors’s sales increased 19 per cent this financial year, helping it to race ahead of Japanese carmaker Honda Cars and secure the fourth spot among peers in the domestic market. In the same period, Honda’s sales rose by 17 per cent. 

Between April 2017 and January 2018, Tata Motors sold 149,284 units of passenger vehicles. Honda Cars sold 144,802 units in the period. In FY17, Tata Motors had sold 153,151 units, compared to Honda’s 157,313 units.

Honda, however, claimed to be unperturbed by the change in the pecking order.

“What we try to achieve is a higher market share. We require at least a 10 per cent share in the Indian market to have a sustainable position,” said Yoichiro Ueno, president and chief executive officer, Honda Cars India. 

The company now has a 5.33 per cent share in India — the fifth-largest passenger vehicle market, where 3 million units are sold annually. Only two carmakers — Maruti Suzuki (50 per cent) and Hyundai (16 per cent) — enjoy a double-digit share in the Indian market.    

“Our strategy is to gradually build our market share. We have a good market share in big cities, but not in sub-urban areas. We have set up dealerships in tier-II and -III cities,” Ueno said.

Tata Motors wants to grab the third sport in the market by end-2019. Ahead of it are Maruti Suzuki, Hyundai, and M&M. The revival in its fortunes was led by products. In 2017, it launched three new cars — Hexa, Tigor and Nexon SUV; in 2016, it had launched Tiago. 

“We are optimistic this growth momentum will continue,” Mayank Pareek, president of passenger vehicle business unit at Tata Motors, said early this month. FY18 is set to be the best year for the company’s passenger vehicle business since FY13, when it had sold 222,112 units. 

Tata plans to launch more products to gain volume in FY19. Sources said this could include a premium hatchback and another SUV. 

Its Q3FY18 performance also reflects its improved performance. The standalone business reported a profit of Rs 1.83 billion after five loss-making quarters, helped by cost-reduction measures and volumes in both commercial and passenger vehicle businesses. 

“The third-quarter performance is not a short-term gain by postponing something to the next quarter or fiscal year. The improvement is structural and sustainable. The product cost optimisation we have undertaken is sustainable,” Guenter Butschek, managing director and chief executive officer at Tata Motors, had said last week.