The word out of Mumbai this morning is that Tata will be going for "an outright purchase" of Jaguar and Land Rover when the ink dries on its buyout of the two automakers from Ford. It was originally assumed that Ford would still maintain a minority stake in both luxury marques, as it did with the sale of Aston Martin to Prodrive last year, but the Blue Oval boys have determined that the Tata is well equipped to take over both brands entirely. However, we're unsure if Tata has the infrastructure to supply Jag and L.R. with the necessary components, from drivetrains to switch knobs. We'll know more when the deal is sealed in the coming months.
[Source: Reuters]
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Reader Comments (Page 1 of 1)
Mattias @ Jan 30th 2008 5:28AM
Maybe Tata soes not have the infrastructrure for small stuff, but FIAT has. Since FIAT and Tata are making a closer joint venture, it would seem likely that some Alpha Romeo switches appear in Jaguars and Land Rovers.
With FIAT supplying engines and stuff this might lead to strange constellations, for example FIAT daughter IVECO just acquired some stakes in Santana, a spanish manufacturer of a license built Land Rover, outfitted with IVECO SOFIM engines, now it seems possible to outfit original Land Rover Defenders with the same engines.
rgseidl @ Jan 30th 2008 7:30AM
Just because Tata will own these brands outright does not mean they cannot continue to source parts from Ford for the current models. In fact, I'm sure that's part of the agreement.
Future models are a different matter. Tata is a large automaker but there is little in its parts bin that the ailing luxury brands can leverage. Rather, I suspect Tata is making the purchase to improve the technology portfolio it can draw on for the increasingly competitive Indian market. Few complete Jaguars or Land Rovers will be sold there, but selected components will be designed in England, built in India and installed into new, comparatively upscale models sold to well-heeled Indian consumers.
Vehicle production in Europe will probably end in the long run, if only because meeting the EU's CO2 regs would be quite expensive. Instead, the two brands will morph into in-house design and engineering divisions.
Tagg @ Jan 30th 2008 12:11PM
Thank You!!
I would bet they buy the component from Ford just as you stated until they get their parts in order.
Remember, Ford bought engines for the Range Rover from BMW for a few years until they developed their own.
Frylock350 @ Jan 30th 2008 8:22AM
They'll bleed any credibility left from these brands to bolster themselves. It'll be interesting to see what they put under the hoods of these cars and such without Ford powertrains and components. Ford parts made Jags far more reliable than they've been in the past.
Couldn't somebody who had something to offer these two brands have purchased them. Like Honda perhaps? They could use the two markets they don't compete in (Acura isn't worldwide) right now and I don't think anybody would argue that Jag/LR would benefit from Honda parts whereas they'll be dragged through the mud with Tata "parts".
Yeah and something calling in for warranty/recall issues and getting somebody with English comprehension skills that would make a 2nd grader look like Shakespeare would make me never want one of these. I am interested to read the broken English owner's manual though.
Mr. Oak @ Jan 30th 2008 10:41AM
VP, I agree with most of what you said here. However, "American Leadership" is not responsible for LR's shoddy reliability record. Ford did more for Jaguar by just firing Lucas (the Prince of Darkness) and getting his unreliable electronics out of those cars.
Never understood why Jaguar's product was so stagnant. They should have moved on from that tired XJ design a long time ago. Replacement S-Type was a real disappointment.
Understood the Mondeo based X-Type to introduce the model. Should have been working on a proper Jaguar replacement the day after launch.
XF is just so so to me. Nice for a Jaguar but cars like the CTS, 5 Series, E-Class, A-6 and their respective hi-po derivatives, have already raised the bar. XF will be stale in two years.
Vik @ Jan 30th 2008 2:37PM
Frylock350- your "comprehension skills" must not be so hot either. So I take it when I call in for customer service for my BMW, you probably think I speak to someone with a German accent?
Umm....just like everyone else, they would have customer service centers in the US.
N @ Jan 30th 2008 11:43AM
Am I the only one who feels sorry for the chaps at TATA who have bitten off more than they can chew?
How anyone could hope to make Jaguar profitable in the short to medium term is beyond me. Jaguar have produced lack lustre rubbish for the last 40 years, their workers and engineers are some of the laziest in the business (who else allows their staff to work only 4 days week?). As any taxpaying Brit will point out, JLR have spent the majority their existence recieving fat subsidies from the government.
To this day, Jaguar retains this legacy of unionised lazy British "workers." If I was on the board at TATA, I would suggest stripping Jaguar of all its plant machinery and moving the factories to eastern Europe -> Audi, VW and Ford are all sucessfully producing high quality vehicles in their eastern European plants.
Land Rover should follow a similar path - but given that the Land Rover Defender could be built better by a group of starved, blind, paraplegic children - perhaps TATA can start production elsewhere and produce low cost agricultural vehicles under the JLR brand?
Neither LR or Jaguar have managed to publish any ground breaking research papers in the last 50 years... not even a fold away cup holder can be attributed to either company.
Every other automotive manufacturer pulled out of the bidding process because JLR did not have a suitable or containable business plan for the Euro VI emissions legislation... perhaps they were hoping that Uncle Henry would just bail them out again with some nice emissions compliant engine and drivetrains.
So what would you do if you had just purchased two companies with a long history of 'doing less than the bare minimum to survive?'
Good luck Tata!
trevor2k @ Jan 30th 2008 11:47AM
So, because the brands get sold to an Indian conglomerate (think of GE for a US example), you ignorant people assume that customer service will be handled in India? Land Rover and Jag have offices in New Jersey and California. They won't just close those down and outsource to India.
As for parts and engines - LR, Jag, and Volvo (kinda) have been sharing tech and engines for a while now, and I am sure that there are agreements in place to provide parts and tech support for all of those before Tata takes over. They also already have agreements to continue manufacturing the vehicles in Solihill and Gaydon, England. Honestly, from a customer point of view, there will be very little change to the end user.
Oh, and for the racist GMMan4Life - Land Rover won't miss you.
Playdrv4me @ Jan 30th 2008 2:13PM
This is pretty much the beginning of the end for Land Rover. Any credibility the brand gained when it was owned by Ford will be lost for nothing other than the ignorant consumers who will associate Indian ownership with a cheapened product.
I've said it before and I'll say it again. Selling Land Rover to raise firesale cash is among the stupidest decisions Ford has ever made and it just goes to show the schizophrenic mentality of the leadership there now.
Selling Jaguar? Fine, they DID ALOT to improve its reliability, but it never sold well. The only mistake they made there was NOT selling it to BRITISH OWNED JCB Construction when they had the chance, who would have maintained Jaguar's british heritage in a way no Indian firm (or American for that matter) possibly can.
Selling Aston Martin was only a *semi*-dumb move because it had only JUST started making money, was a niche' brand, and they still retained a portion of it anyway. But Land Rover had been turning a profit for awhile, skated through pretty-well unscathed in the Ford take-over, and was producing some genuinely DESIRABLE products with VASTLY improved reliability over their older counterparts. SUV's are STILL the in-thing with the nuvo-riche crowd and they don't particularly care about fuel economy. Thus, the market for these vehicles was still wide open.
As an owner of a 2003 Range Rover, this is a very sad day for the LR brand indeed. It's like when they put a Wal-mart next to your house and the property value on your whole block goes down.
For the record, it wasn't just the engines Ford bought from BMW, the ENTIRE engineering and chassis architecture of the 2003-2005 was entirely BMW through and through, including virtually the entire interior. Not only that, Ford acquired the former BMW chief of the entire Range Rover project at that same time. It was a practical giveaway to Ford, which is another reason it's absolutely idiotic to firesale it.
brn @ Jan 30th 2008 7:44PM
"you ignorant people assume that customer service will be handled in India?"
I wouldn't assume it, but I wouldn't be the least bit surprised. Many US companies outsource their help desk to India. Try calling GM sometime. There's a fairly good chance you'll get India (it's quite annoying).
adrian @ Jan 30th 2008 8:19PM
I think it's wrong to blame the British workforce for what has happened at Jaguar. When Ford closed one of Jaguar's plants I don't remember any strike action in protest, The workers dealt with it in a mature manner because they belived it was for the greater good.
The fact is Ford and Jaguar management along with the design team did not get their arses in gear years ago and move with the times.
The design team kept producing old fashion looking cars that did not appeal to the younger generation like BMW Audi and Mercedes. Sales figures for german cars and who's buying them would of told them that's where the money and future is.
Jaguar should also of had a small plant in the US to help cope with the exchange rate that was killing sales in the US, just like the german car makers.
They sat back like Rover,and look what happened to them. Having said that I wish Tata well though.
AMcA @ Jan 30th 2008 11:04PM
The Financial Times reported recently that the Ford/Jaguar/Tata deal contained - if I recall - 11 side deals for Ford's services, parts, etc. to keep Jaguar going.
tifoso471 @ Feb 5th 2008 12:58AM
You don't need to feel to sorry for Tata N.
Ratan Tata, the head of the Indian conglomerate Tata, specializes in streamlining and revamping the efficiency of unionized, slow, lethargic, government sheltered companies into cut-throat, top-of-the-line companies that can match the best in the world, in the most competitive environment.He has the competence, and the confidence to turn around Jaguar, and he will. There isn't any doubt in my mind.
Also, don't be too quick to judge the Tata company as an Indian firm biting of more than it can chew. The company is HUGE, with revenues over $20 billion. Moreover, they know what it takes to do succeed in not only developing countries, but the Western world as well. If you live in New York, Boston or San Francisco, take a walk to the Pierre, the Taj Boston, or the Campton Place hotel to undertsand that Tata knows how to handle luxury brands.