In continuation of our conversation with industry leaders at the sidelines of the CM convention 2025, I have with me Sesh Chandra, who is the president of CM and also the managing director of Tata Motors. Sesh, thanks so much for talking to us.
Thank you for having me on the show.
Great. Great. Chesh, very quickly, you know we've heard everyone talking today about the auto industry, the opportunity. There's one thing I want to touch upon right now is the FDA's coming in, potential of exports, imports as well. What is it going to take for Indian companies to be truly global? I mean, looking at Tata Motors' journey for example, you know, still very much domestic. You've done phenomenally well in the domestic market, huge growth. But quite frankly, looking at the way the Chinese have gone internationally, Indian companies are just not quite there. Is that now the next frontier?
You know, eventually the destination of any company in any part of the globe has to go global, right? Otherwise, you will never be able to hedge your risks by being exposed to this one market. So that's definitely your destination. Now, in terms of the approach, it cannot be overnight that you become a global company by just spraying your products across the globe just like that. So you have to go selectively, you have to go more phased. You'll first try to select markets where you can be relevant, where brand can be considered.
And South Africa is one market where you got back into.
Yes, for example, that's a very relevant market. The second step is definitely first, and that regulations in India is helping us to first harmonize yourself with the rest of the world's regulation. You know, you can't have regulation here and the other regulation is so high that you are not even thinking of investing so much to take the risk of first opening the market and then not being closer to regulation. So it requires huge investment. I think over the last 10 years, if you see, this harmonization has been a big effort, and the other leveler has been the electric vehicle.
Where at least the emission regulation completely goes out of the equation?
That's interesting. So EVs are a leveler and this gives you the opportunity.
So regulation, selective market, because these markets will also give you the foundation of why you should be considered in a more difficult market. Right? Because brand is the biggest question. You can have great products but if your brand is not strong, you will not be considered despite great product. Great product has to be there. So great product is what?
That's hygiene, actually. Great product is aspirational, stunning design, tech which is world class. You gave the example of China. So we have to work on these two aspects definitely, and hygiene, which is something which is still work in progress for a lot of automakers in India, is the quality.
Which is global, right. I think these are all a mix and part of the journey which will help you become a truly global company, but internationalization will start. But whether you will be a global company or not, even the Chinese companies would not be global companies today, right?
They are starting their internationalization journey. Their brand will also struggle. They'll have to establish that. That's why I said, even with best tech, it's not sufficient. You have to first come into the awareness and consideration of the consumers, customers in every market, and that's a journey that you have to go through.
Right. So clearly I think what you're saying is that, would you say also that growth in our market now at this high base we can't expect double digits to suddenly happen? And if we have to grow in double digits, then brands and manufacturers' exports will have to play a key role in that double-digit growth.
You know, India will be, I would say, the highest growing market in any case.
And the long-term trend if you see, fluctuations will keep happening. You saw 25% growth in the last 5-year period, in the first 2 to 3 years after COVID, and then it has flattened. But this flattened growth is not the future growth. The secular growth trend of, say for example, passenger vehicle industry we have seen is nearly 1.2 to 1.3 times of your GDP growth.
Right, which means 6 to 8% is given.
As a growth rate for India.
So India will provide you the best opportunity. You can be an operator in India. You can be happy. But that's not the point, because you are being attacked by all the global players here. So why not therefore you also leverage?
Outside the country. So this phenomenon will keep happening. I think India will give you the big opportunity. But it is also a hedge from two aspects. One, volume risk hedge, because if the market goes up and down...
The second is, if you have to be competitive in India, you have to be globally competitive also, because you're being targeted by all the global players.
Right.
When you go outside India, if you go outside India, developed markets, your quality levels have to be high, your tech has to be high.
So that becomes the pivot or anchor around which you make your products work.
It's not the features anymore. It's really the quality and the other aspects of it.
And going through that difficult journey of establishing your brands in a difficult market. I think it takes a lot, but it makes your job easier.
