Tata Motors is actively considering truck assembly plants in some African markets through collaboration with local partners as the country’s largest truck firm seeks to grow its export business bigger in a bid to offset some of the cyclicality of commercial vehicle (CV) business in the domestic market.
While the company is intensifying its efforts to regain the lost momentum in South Africa, where it entered many years ago, it’s seriously looking to tap the potential in the rest of the African geography like Nigeria, Kenya, Senigal, Tunisia, among others, though import tariffs are being introduced in some of the nations.
“Of course, business everywhere is cyclical, but the cycle may not coincide. Export is an area we are really bullish. We will be looking for third party local assembly ventures in African geography. In Bangladesh, we have an assembly unit through a local venture in which we have a minority holding. We will try a similar model in Africa,” a top company official told The Hindu.
“We have definitely commenced the efforts, but nothing has been finalised yet,” he said adding, “we also work with Tata Africa Holdings, which is responsible for market development for Tata group in Africa, and they are our partners and we hope to finalise our plans within the next financial year.”
The proposed project will be country-specific local assembly venture, but may also look at serving other markets in the region, which has both left-hand and right-hand drive markets.
SAARC nations such as Sri Lanka, Bangladesh and Nepal have traditionally been strong markets for Tata’s truck exports. It has recently entered Indonesia and Australia through own venture and distributor, respectively. The company is the largest exporter of trucksfrom India with annual volumes of over 40,000 units.