Hello TaTa

With the recent signing event in China that officially acknowledged the highly anticipated cooperative agreement between Chrysler and Chery, a new era in North American automobile history has begun. Chrysler announced plans to outsource manufacturing of a new subcompact destined for the European and North American market to Chinese automaker, Chery motors. The two companies plan to develop, manufacture and distribute Chery-made small and sub-compact cars in North America, Europe and other major automotive markets under the Chrysler Group brands.

One major statistic stands out:

from Globe and Mail:

“THE CHANGING FACE OF AUTO MANUFACTURING
$73
Average amount unionized assembly line workers make per hour in the United States, including benefits (U.S. dollars).
83¢
Amount in U.S. dollars that Chinese auto maker Chery says it pays assembly line workers per hour, a total of $132 a month.”

North American auto-workers have every reason to be worried.

The move by privately-owned Chrysler to manufacture entire cars offshore will force other auto-makers to target the under ten thousand dollar car range in North America, and will necessarily involve offshore manufacturing.

One car company to keep an eye on is TaTa Motors based out of India.

Check out TaTa Motors' ADR on Google Finance

Check out TaTa Motors' Website

TaTa motors is India’s largest auto-maker and presently has deals in place with Fiat among others. TaTa Motors is a growth story all the way. TaTa Motors is already a huge player on the international stage and is a safe bet without taking any leaps of faith. If it was to suddenly get involved in a North American play, the stock price would sky-rocket. Even without a North American play however, it has huge growth potential in the domestic Indian market alone. Say “ta ta” to the big three and “Namasthe” (hello) to TaTa motors.

DISCLOSURE: I own shares of TaTa motors. Do your own research!