"We are looking at shrinking our supplier base by filtering out low quality suppliers," Ravi Kant, managing director, Tata Motors said after launching 'Tata Novus', the heavy commercial vehicle range.
Kant said that as part of this exercise, Tata Motors, the country's largest commercial vehicle manufacturer, was looking at going along with "key vendors". The company has introduced the latest range in partnership with its South Korean subsidiary Tata Daewoo Commercial Vehicle Co, formed after it acquired Daewoo Commercial Vehicle Co. in 2004.
Kant said contribution of exports to the revenues of Tata Motors was on the rise as the company was entering newer markets as part of its approach of going global.
"Exports for us have been growing and should increase further. They are expected to be 17 per cent in value terms for us now against less than five per cent 3-4 year back," he said.
The Novus range, which was launched in Korea earlier this year, is already being exported to 15 countries. "As much as 40 per cent of the production from Korea is being exported," Kant said.
In India, the company is manufacturing the range at its plant at Jamshedpur where it has a 6,000-unit annual capacity.
It launched the 300-hp Tippers in the market, which are priced between Rs 36-39 lakh, significantly lower than similar models from foreign rivals like Tatra and Volvo, which are priced above Rs 45 lakh.
"We have a 30 per cent localisation level on Novus which is expected to go up to 60 per cent in the next one year," Kant said, hinting that prices may further decline as indigenisation levels increased.
He said the market for tippers in India was about 25,000-30,000 units per year and has been witnessing a growth of about 15-20 per cent annually. "Tata Motors has about 70 per cent share of this market while the rest is shared by other domestic players as well as foreign companies," Shyam Mani, vice-president (sales and marketing), commercial vehicles, said.
The company said it was hopeful of the prospects of the Novus range with increased mining and road construction activities in the country.
"The Tata Novus range will be backed by Tata's network of about 450 dealerships and service stations and other initiatives like on-site support, single-point contact and 24-hour contact," a company official said.
Kant said the company had the option of doubling production levels at Jamshedpur, though it would study the market response to the range before any decision.
Asked whether the company will also look at exporting the Novus range from India, an official said this was being studied. "It has to be decided by the two divisions in Korea and India respectively," he said.