News: Tata Motors hits new African trail

(DNA 30/10/2006) Mumbai - Tata Motors is looking at options like setting up assembly lines, re-working on its price and product positioning, improving logistics and getting into local sourcing in order to beat the unexpected depreciation of rand, South African currency.

“We are looking at increasing our logistical efficiency besides considering options to set up an assembly unit in South Africa. We are also looking at using South Africa as a source for components,” chief financial officer Praveen Kadle said. The only commercial vehicle assembly unit the company has outside India is in Bangladesh.

Managing director Ravi Kant added that the company would look at “price positioning” and hedge against currency depreciation by moving some work to the African nation.

Tata Motors declared its July-September quarter results. On a consolidated basis, revenues, grew 42% year-on-year to Rs 7,703 crore, while net profit grew 36% to Rs 536 crore from a year ago.

Rival Ashok Leyland also declared its second-quarter results on Monday. Net profit was up 27% year-on-year to Rs 95.3 crore while revenues were up 34% at Rs 1,709 crore. Ashok Leyland suffered a bigger slide on its operating margins, which dipped by 130 basis points.

Force Motors also announced its July-September quarter results by reporting Rs 6.8 crore loss against Rs 3.75 crore profit during the year-ago quarter.