Friday, 10 March 2017
VW and Tata Motors to explore cooperation
Volkswagen AG and Tata Motors Ltd. have signed a memorandum of understanding (MoU) aimed at exploring long-term strategic cooperation in clearly-defined fields.Volkswagen, which has set about 'rescuing' Navistar International Corporation in the US has turned its face eastwards and has hooked up with Tata Motors. The goal of the strategic alliance is to “bundle the expertise” of both car manufacturers with a view to jointly developing vehicle components and possibly also vehicle concepts. ŠKODA Auto has been given the job of spearheading the investigation into any possible collaboration.
For the Volkswagen Group, the MoU with Tata Motors Ltd. marks a “further trailblazing step” in the context of its “TOGETHER – Strategy 2025”. Under the terms of the memorandum, the Volkswagen and Tata will explore possibilities for a strategic partnership in India.
In order to share responsibility among the Volkswagen Group brands, ŠKODA Auto is to lead the project. The first step will address topics such as the application of specific market knowledge as well as local development expertise. In the long term, the Volkswagen Group is looking to further expand its product portfolio in the fast-growing emerging markets.
“Our aim with the envisaged strategic partnership with Tata Motors is to lay the foundations in the Group and the brands that will enable us to offer customer-oriented mobility solutions in the emerging, fast-growing automobile markets, as elsewhere. By offering the appropriate products we intend to achieve sustainable and profitable growth in very different parts of the world. That is why we are systematically pursuing our regional growth strategy”, explained Matthias Müller, chief executive officer of Volkswagen AG.
“We are delighted to announce our potential cooperation with Volkswagen Group and ŠKODA. We strongly believe that both the companies, by working together, can leverage from each other’s strengths to create synergies and develop smart innovative solutions for the Indian and overseas market. This is in alignment with Tata Motors efforts to make itself ‘FutuReady’ by embracing new technologies, fostering higher platform efficiency and offering solutions that connect with the aspirations of our customers”, noted Günter Butschek, chief executive officer and managing director of Tata Motors Ltd.
“We are looking forward to the joint project with Tata Motors. Delegating project responsibility to ŠKODA underscores the great confidence of the Volkswagen Group in the ability of our brand. Together with Tata we will be specifying the concrete opportunities for collaboration over the coming months”, added Bernhard Maier, chief executive officer of ŠKODA Auto.
The contractual framework and the guidelines for a strategic cooperation between the Volkswagen Group and Tata Motors Ltd. will be examined and defined in detail over the coming months. Until then, the parties have agreed not to disclose any information.
Tata Motors Limited is India’s largest automobile company, with consolidated revenues of INR 2, 75, 561 crores (US$ 41.6 billion) in 2015-16. Through subsidiaries and associate companies, Tata Motors has operations in the UK, South Korea, Thailand, South Africa and Indonesia. Among them is JaguarLandRover, the business comprising the two iconic British brands. It also has an industrial joint venture with Fiat in India. With over 9 million Tata vehicles on India’s roads, Tata Motors is the country’s market leader in commercial vehicles and among the top in passenger vehicles. Tata cars, buses and trucks are being marketed in several countries in Europe, Africa, the Middle East, South Asia, South East Asia, South America, Australia, CIS and Russia.