Large Emerging Market Companies Taking Advantage of the Downturn

Large emerging market companies, such as Tata Motors, are taking advantage of the recent global downturn (see Economist article). Such companies are finding they can take advantage of their relative positions in making low-cost production models, due in part to their inexpensive labor. Even without global demand, growth in developing companies is still increasing, even though it has slowed, allowing such companies to stay afloat due to local demand. Finally, there is less international pressure on companies that can make it domestically, since multi-national companies are focusing their investment at home, and becoming more inward looking. Such a development can allow a company making greener technologies, such as Tata, to gain a stronger position, while also allowing new companies more opportunity to get started without high initial competitive pressures.