The transaction is expected to close by the end of June this year. This is yet another historical move Tata Motors has made in less than three months, following its announcement in January that it would produce the Nano, the cheapest car in the world, at the cost of a mere $2,500.
“We are very pleased at the prospect of Jaguar and Land Rover being a significant part of our automotive business,¡± said Ratan Tata, chairman of Tata Sons and Tata Motors, speaking on the agreement. ¡°We have enormous respect for the two brands and will endeavor to preserve and build on their heritage and competitiveness, keeping their identities intact. We aim to support their growth, while holding true to our principles of allowing the management and employees to bring their experience and expertise to bear on the growth of the business.¡±
With more than a century-long history, the Tata Group has been involved in various industries including IT, Iron and Steel, automobiles, electricity, telecommunications, watch and jewelry, tea, engineering projects, etc., growing into one of the biggest industrial houses in
Tata gained a huge amount of revenue in the fiscal year 2006-2007, which accounted for 3.2 percent of the total GDP of India. The stock value of the listed company reached $73.6 billion on the last day of 2007. Not only does Tata have rich fund deposits, but it is also full of talents and technical backups within the company.
Ratan Tata, the ambitious leader of the Group, wants to create a multinational conglomerate covering many industries in the world instead of just an international business.
In the automotive field, for instance, Tata hopes to build an international empire as powerful as
In fact, Tata has come out as a star of the global automotive industry through two events ¨C making the cheapest car and acquiring Jaguar and Land Rover within a short period of three months.
Perhaps, it is too early to come to such a conclusion. After all, Tata is the single largest automaker in
On the contrary,
However, the rapid growth of Tata Motors has provided much experience to Chinese automakers. It is possible that the local companies in
Looking from a commercial point of view, Tata¡¯s acquisition of Jaguar and Land Rover is merely one of the hundreds of events in the automotive world. But does the unusual development of the automotive industry in both
One year ago China¡¯s SAIC and NAC began to produce Roewe and MG following the purchase of the British giant MG Rover. Now Jaguar and Land Rover have become part of Tata¡¯s brands. Will the growing Asian automakers lead to a change in global automotive strategies?
The past 100 years saw three rounds of global adjustments in the global automotive industry: from Europe to the U.S. and then to Asia. Apart from the early developers, namely, Japan and South Korea, the progressing ones comprising China, India and Russia could possibly bring about a new round of adjustments in the global auto-making industry.
Now automotive circles in Europe and U.S. are paying a great deal of attention to Tata¡¯s move in acquiring Jaguar and Land Rover, regarding it as ¡°a seminal event.¡± They cannot deny the fact that the global market, advanced technologies and credit brands are moving towards Asian countries in the east.
Although it¡¯s hard to predict the future development of Asian auto giants including India¡¯s Tata, China¡¯s SAIC or FAW and Dongfeng, their massive capital, huge domestic markets, rapidly developing local economies with comparatively cheap labor costs have all made them successful as Asian automotive counterparts.
According to Jia Xinguang, a well-known automotive analyst, Indian automakers headed by Tata are the most daring among the four rapidly developing nations (Brazil, Russia, India and China). They are expanding in every direction ¨C forming joint ventures, making local brands and drawing foreign investments.
Tata has made a significant leap forward by purchasing Jaguar and Land Rover.
“Perhaps China¡¯s Chang¡¯an should have earlier taken advantage of the situation given its close ties with cash-stripped Ford,¡± said Jia. ¡°But it hesitated due to systemic problems and hopelessly let go of the chance in the end.¡±