Skip to content

The Formation of Tata Motors

October 9, 2011

The company was established in 1950 by J.R.D. Tata, as a locomotive manufacturing unit and later expanded its operations to commercial vehicle sector in 1954 after forming a joint venture with Daimler-Benz AG of Germany. Despite the success of its commercial vehicles, Tata realized his company had to diversify and he began to look at other products. [1]

The Tata empire has changed dramatically since Ratan Tata took over from his uncle J.R.D. Tata in 1991 — coincidentally the same year that the Indian government began moving away from its rule by regulation toward economic liberalization. Before 1991, Tata Group and its holding company Tata Sons were said to be like many of the empires of old Asia — weakly centralized, unable to control its satraps and begums and rajahs, full of formal pomp but empty of power. The Tata Sons holding company and the various family philanthropic trusts had diluted their holdings in many of the companies. Under Ratan Tata, the center began to take hold. He moved Tata Group out of sectors where it was not competitive, such as textiles and cement, and invested more family capital in sectors that he thought held more promise. 

Remarkably, considering the state of overcapacity in the world automobile industry, Tata thought and thinks autos to be one such sector. Where Westerners see a stagnant, legacy industry cursed by overcapacity, he sees it, from an Indian perspective, as a growth industry.

TATA Heavy Commercial Vehicle (1954-) – a result of collaborating with Daimler AG of Germany [2]


After years of dominating the commercial vehicle market in India, Tata Motors entered the passenger vehicle market in 1991 by launching the Tata Sierra, a multi utility vehicle built on a body-on-frame structure. After this Tata motors, then called TELCO  launched three more vehicles, the Tata Estate (1992, a station wagon design based on the earlier ‘TataMobile’ (1989), a light commercial vehicle), Tata Sumo (LCV, 1994) and Tata Safari (1998, India’s first sports utility vehicle).

TATA Sierra (1991) – its first passenger vehicle [3]


Based on consumer demand, he decided that building a small car would be the most practical new venture. Tata launched the Indica in 1998, the first fully indigenous passenger car of India. Though the car was initially panned by auto-analysts, the car’s excellent fuel economy, powerful engine and aggressive marketing strategy made it one of the best selling cars in the history of the Indian automobile industry. A newer version of the car, named Indica V2, was a major improvement over the previous version and quickly became a mass-favorite. Tata Motors successfully exported large quantities of the car to South Africa. It was also exported to Europe, especially the UK and Italy. The success of Indica in many ways marked the rise of Tata Motors.

TATA Indica (1998) – its first passenger car built on a monocoque platform [4]


Historic Timeline of Tata Motors  – Compiled from Tata Motors Website

1945 – Tata Engineering and Locomotive Co. Ltd. was established to manufacture locomotives and other engineering products.

1948 – Steam road roller introduced in collaboration with Marshall Sons (UK).

1954 – Collaboration with Daimler Benz AG, West Germany, for manufacture of medium commercial vehicles. The first vehicle rolled out within 6 months of the contract.

1959 – Research and Development Centre set up at Jamshedpur.

1961 – Exports begin with the first truck being shipped to Ceylon, now Sri Lanka.

1966 – Setting up of the Engineering Research Centre at Pune to provide impetus to automobile Research and  Development.

1977 – First commercial vehicle manufactured in Pune.

1991  – Launch of the 1st indigenous passenger car Tata Sierra. TAC 20 crane produced. One millionth vehicle rolled out.

1994 – Launch of Tata Sumo – the multi utility vehicle. Launch of LPT 709 – a full forward control, light commercial vehicle. Joint venture agreement signed with M/s Daimler – Benz / Mercedes – Benz for manufacture of Mercedes Benz passenger cars in India. Joint venture agreement signed with Tata Holset Ltd., UK for manufacturing turbochargers to be used on Cummins engines.

1999 – 115,000 bookings for Indica registered against full payment within a week.Commercial production of Indica commences in full swing.


1., accessed October 2011

2. photograph :, accessed October 2011

3. photograph :, accessed October 2011

4. photograph : , accessed October 2011


From → M136ID

  1. vallabhaneni vikram permalink

    TATA motors r realy suprb
    i’m studying btech in course of mechanical
    i am sure that i will make tata motors to be in first hundred place among fortune 500 companies

  2. Thanks for sharing this post with us…its really very informative….Secretarial Software

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: