PESTLE Analysis of Tata Motors
PESTLE is a business analyzing tool that helps determine various external factors of any company by investigating its political, economic, social, technological (PEST), and legal and environmental factors. It helps to differentiate different extrinsic scenarios and their impact on the businesses. Companies like Tata Motors should use this framework to identify market dynamics and growth opportunities. In the Indian automobile manufacturing industry, Tata Motors is one of the most well-known names. Here is the detailed PESTLE analysis of Tata Motors.
Political Factors | PESTLE Analysis of Tata Motors
Being an international organization, the company is highly susceptible to political flux. Its growth and profitability are highly dependent on the political environment. Thus, they always try to bring tech-savvy solutions to their vehicles. The company has to face different political conditions in other countries to run the business successfully. However, they need to build policies that go well with the political framework. This is the only way to minimize obstacles and grow business. They must be careful about contract requirements, guidelines, and intellectual property rights. Its Nano car was one of the most inexpensive vehicles. The Brexit deal has also affected the business in some ways. As Jaguar and Land Rover, some of its subsidiaries are some of the most successful commercial vehicles of all time.
Economic Factors | PESTLE Analysis of Tata Motors
Several economic aspects drive the business of Tata Motors. They have made several investments in product development but couldn’t get encouraging results that negatively impacted the company’s financial condition. Such things can be terrible for the company’s growth and expansion. Moreover, the fluctuating currency rate, rising interest rates, and other economic factors are also hurting the financial condition of Tata Motors. It is really difficult for companies to operate efficiently. The failure of Tata Nano is another major thing because it was the most successful affordable car. On the other hand, some of its brands like Hexa, Safari, and Humo are not going well and used to be successful in the past.
Social Factors | PESTLE Analysis of Tata Motors
One of the biggest edges the company has is that people trust them. They are providing innovative vehicles to customers at reasonable costs. So, they are really faithful to the brand. In short, people’s influence on the brand is huge and they expect much more from the company. That’s why it is very famous among people. Most of its customers are from the middle and lower-middle-class who want to switch from 2-wheeler to 4-wheeler. Moreover, the company has created various job opportunities, another big reason for its popularity. On the other hand, they are also associated with more than 300 NGOs.
Technological Factors | PESTLE Analysis of Tata Motors
The company has built various innovation centers along with research and development facilities. With the help of such initiatives, they have been offering innovative vehicles to users at lower prices. They are also trying to manufacture eco-friendly vehicles such as electric cars along with fuel-efficient vehicles. Through technological advancement, they can attract investors and consumers as well. But, it requires political stability and financial robustness. The scope of luxury cars is also huge in the Indian market. It will open several opportunities for Tata Motors. The company can change the lifestyle of people by manufacturing modern vehicles with amazing features.
Legal Factors | PESTLE Analysis of Tata Motors
Companies like Tata Motors are highly susceptible to legal factors. Lawsuits or legal proceedings can destroy the brand’s overall reputation in a matter of seconds. Being an international automobile company, Tata Motors should follow liability laws, minimum wages law, and intellectual property rights to avoid any legal trouble. Moreover, they should target those markets that are favorable for the company. In this way, they can enhance their revenue and expansion. They should analyze different aspects of any policy or strategy before implementing it. This will help the company to reduce the risk of any legality, and they can run the business without any hurdle.
Environmental Factors | PESTLE Analysis of Tata Motors
Tata Motors is very concerned about the environment and trying to adopt green initiatives. Indeed, they are planning to produce eco-friendly cars to reduce their carbon impact. Moreover, the market of electric cars is very bright, and they can exploit this thing in favor of the business. They can bring new advancements to the motor industry by introducing high-quality vehicles. However, they must follow all the environmental rules and regulations to get the attention of eco-friendly customers and environmentalists.
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