After one of its worst years, the automobile industry in India is seeing early signs of recovery and renewed confidence amongst consumers, according to Cyrus Mistry, Chairman, Tata Motors.

In a letter to company shareholders, the chairman said, “we expect a turnaround of the industry by the later part of this financial year with a hope that the government would also come out with policy interventions that support the growth of the automobile industry.’’

The rising inflation and high interest rates for most of last year led to relatively low consumer interest in buying new vehicles and in many cases, postponement of purchase.

Mr. Mistry said that Tata Motors’ domestic business in commercial vehicles and passenger vehicles lost market share in 2013-14.

On the industry, he said in the later part of the year, reduction in excise duty and partial lifting of mining bans did help in recovery of sentiment to a limited extent. “High delinquencies in vehicle financing led to tightening of lending norms by financiers, which badly impacted the sales of small commercial vehicles and passenger cars.’’

Both segments saw aggressive competition and several players resorted to huge discounting but Tata Motors’ approach was “cautious and responsible.’’ Tata Motors focused on keeping inventory levels low in order to reduce the burden on channel partners.

According to Mr. Mistry, Tata Motors was at an “inflexion point’’ with its entire product portfolio being revamped with relevant and exciting products for our target customers. It is working on a strong pipeline of new products and technologies keeping in view the changing market, customer’s aspirations and regulatory needs.

Further, he said the company was pursuing initiatives on cost-erosion and customer experience “with greater rigour to help transform the organization into a more competitive and profitable business in the coming years.’’

On Jaguar Land Rover, he said the company remained committed to making investments in the two brands and planned to deliver a slew of new products in the next five years adding that JLR posted record sales during FY’14 and will continue to expand its manufacturing footprint in growing markets like China and Brazil.

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