Tata Motors and Castrol today inked a three-year agreement under which the lubricants maker would supply commercial vehicle oils to the homegrown auto major in over 50 markets including SAARC and ASEAN region, Middle East, Africa, Russia and Latin America.
"Tata Motors has had a long and enduring partnership with Castrol in India, delivering exceptional products and outstanding service for our customers. We are delighted to extend this partnership to a global level and look forward to leveraging our complementary strengths to offer our channel partners high quality support," Tata Motors CEO and Managing Director Guenter Butschek said in a statement.
As Tata Motors expand globally, Castrol with its established presence in these markets, will support Tata Motors' channel partners with high quality products and services to enhance their market share and profitability.
"As Tata Motors explores new markets, we are committed to supporting them with our pioneering technology products, superior service offers and expertise in retail marketing and promotion, to add value to this partnership," BP Lubricants CEO Mandhir Singh said.
As part of the pact, Castrol will work closely with the Tata team to co-engineer products suited to meet specific requirements of new engine technology and environment regulations.
Butschek said the company's presence in the entry level
hatchback segment, where Nano is positioned right now, is something which needs to be decided as it is a very competitive segment.
Stating that in the next few years the segment is going to witness a lot of change in terms of regulations related to safety and emissions, he said the question is whether there is a need to be in the segment or not and that is "indeed a question which is pending".
Industry analysts said while the company has decided to move on the advance modular platform, "the strategy raises some concerns regarding the future of some of Tata Motors' existing nameplates, most notably the Nano".
"A move to a new platform for the Nano would be likely to increase prices, potentially rendering it uncompetitive. At the same time, stricter regulations in the areas of crashworthiness and emissions will make it difficult for the nameplate to continue on the old platform," IHS Markit Principal Analyst (World Markets Automotive) Anil Sharma said.
In the meantime, Nano sales continued to be on a downward spiral. During the April-December period this fiscal, it sold 6,714 units as compared to 17,258 units in the same period last fiscal, down 61 per cent.
