Former senior principal correspondent at Forbes (India). Since 2008, I have been writing on corporate strategy in the automobiles, clean technology and supply chain space. Before I got onto this assignment, I was part of the team that covered feature articles at The Economic Times. I actually started out as a trainee journalist on the ET desk in 2006. I graduated in commerce from Shri Ram College of Commerce in New Delhi and now live in Mumbai. I love automobiles and spend hours reading up on them and then devote painfully long hours to work on old cars that attract my fancy. Right now I own four cars (my colleagues call them fancy, junk or whatever) and a bicycle which outside my work hours get most of my attention.
Last I checked, Karl Slym, former head of General Motors India, said he was ‘settling down in his new home’ in China and things were looking good. It now turns out, he didn't plan on staying too long. Tata Motors announced on Tuesday that Slym joins them as managing director, replacing Prakash Telang. That the company needed someone to take over from Mr. Telang and lead the domestic passenger car and commercial vehicles business was known. But Karl Slym's choice to be their Knight in shining armour is certainly a googly.
You might remember Slym as the face of GM’s advertising campaign in India in 2008-09. He appeared on television often with the Chevrolet promise, and that made him pretty famous. The first weekend after the commercial aired, he managed to get a free hair cut in Delhi! He spent four years as the head of GM’s India operations and loves the country. Even as he was packing his bags for China last December, he said his family would miss their time in India. They no longer felt like foreigners and didn’t really want to move.
For the Tatas, Slym brings his years of experience with a global car manufacturer. He started his career as a general manager at Toyota, moved to GM in 1995, and since then has held various roles across geographies like director of manufacturing at Gliwice, Poland. He then went to GM in the US and Canada and later became head of quality, APAC-Seoul, following which he moved to India. GM India's limited success, from the Spark small car to the Beat and the Chevrolet Cruze, was largely lead by him. The company that had struggled to find its feet here for more than a decade (GM set shop in India in 1995), was able to tot up some volumes during his stint. He was also successful at protecting the India business from GM’s global troubles (the bankruptcy period of 2010-11).
His new stint at Tata Motors will certainly be no walk in the park. For starters, he will have to figure out the road ahead for Tata Motor's floundering domestic sales. As things stand, about 65 percent of revenue and almost 90 percent of Tata Motors’s profits come from Jaguar and Land Rover (JLR). The India car and commercial vehicles business is dwarfed by the size and scale of JLR. Both businesses are under intense pressure from competition. In the commercial vehicles business, there’s credible threat from Daimler’s entry plus the improved performance of the Eicher Volvo joint venture. Slym has no background in commercial vehicles. Is that important? I would think, yes. Though Tata Motor's former MD Ravi Kant, too came with this handicap, but was able to do a great job. Tata Motors still has Ravi Pisharody to lead the CV business and Slym will have to work with him to protect their lead in the segment.
But the toughest nut to crack will most certainly be Tata Motors’ domestic car business. Every link there seems to need fixing. From the Tata Nano to figuring out the next generation of the Indica/Indigo range and Tata’s utility vehicle Safari. Then, Tata Motors still hasn't figured out a clear export strategy for its passenger vehicles. Can Slym take the Nano to other markets? I think this will be a closely watched affair.
Product strategy is just one part of the problem. Slym's arrival should signal some clear direction on the engineering challenge, specifically engine development program at Tata Motors. Currently, the company relies on its JV partner, Fiat, for the supply of engines. I remember Carl Peter Forster, the former CEO of Tata Motors (and also a GM Europe executive), was uncomfortable with the idea that a car company of Tata's size has to rely on others for what is perhaps the heart of a passenger vehicle. And it is here that Slym will also have to clear the cobwebs on the future of the Tata-Fiat joint venture. GM's struggles in the past decade are legendary, Slym may need to use a trick or three from the Detroit major's survival manual in his new job at Bombay House.