Part of High Gear Media

What's The Best Place For Your Teen To Learn How...

News

Hong Kong Witnesses First Aston Martin One-77... Supercars
59 minutes ago

Wreckage of Aston Martin One-77 that crashed in Hong Kong - Image courtesy Weibo

2013 Volkswagen CC Gets Sporty R-Line Trim Luxury
May 27, 2012

Formula 1 Monaco Grand Prix Weather Forecast Racing
May 27, 2012

SEE ALL NEWS

Topics

Reviews

Videos

2013 Mercedes-Benz G63 AMG: First Drive

SEE MORE VIDEOS

Spy Shots

2014 Audi S3 Hatchback Spy Shots

2013 Porsche 911 GT3 Spy Shots

2013 Aston Martin DBS Replacement Spy Shots

Car Tech

Volvo Explains Its Pedestrian Airbag System

The founders of Google and one of their autonomous Toyota Prius hybrids

California On Track To Be Next State For Autonomous Car Trials

Audi Offering 4-Year SiriusXM Traffic Subscription On Select 2013 Models

Home

News

Industry

Experts say Tata's bid for Jaguar and Land Rover a mistake

Experts say Tata's bid for Jaguar and Land Rover a mistake

Nelson Ireson

Editor BIO

Nelson is an Editor at High Gear Media focusing on reviewing cars and covering the hottest topics in luxury and performance cars, car culture, and... More

LATEST ARTICLE
Volkswagen Golf R Cabrio Patent Photos Revealed
What to do if you love the Volkswagen Golf R, but just can't do without a drop-top car for summer?... Read More

#3LEADERBOARD RANK
5443ARTICLES CONTRIBUTED
205COMMENTS POSTED

1,399 views Sep 17, 2007

Follow Nelson

Add to circle

Experts say Tata's bid for Jaguar and Land Rover a mistake

Enlarge Photo

Last month, India's Tata Motors announced it is looking to move into the high-end global auto industry with a bid to purchase Jaguar and Land Rover. Ford Motor Company, the current owner of the luxury marques, has put the companies up for auction to help ease its financial troubles. Now, industry experts are beginning to question the wisdom behind such a deal.

A member of the Tata Group, India's largest conglomerate - making everything from steel to tea - Tata Motors current product lineup is built upon a backbone of work trucks and affordable, mass-market cars. Purchasing Jaguar and Land Rover would not only give the auto maker entry into myriad global markets. Acquiring the legendary British marques so soon after establishing independence from the UK would be a huge boost to Indian national pride.

Home market sales account for 90% of Tata's revenue at present. Tata has mastered volume sales, and is currently developing what is being billed as the world's least expensive minicar, due in 2008. However, the maker is seeking to move into other markets where such inexpensive cars offer not only comparatively poor performance and cheap interior materials, but may not be able to pass stringent safety tests. An infusion of ready-made platforms, technology, and experience from Jaguar and Land Rover may be just what the Indian giant needs to break into global auto sales.

On the other hand, the lack of corporate and brand synergies between Tata and its intended acquisitions is so great that industry analysts are calling the purchase a mistake. Indian auto parts makers do not have the technical capability necessary to support production of luxury automobiles, meaning Tata could not likely benefit from lower wages and materials costs by producing the cars in India. Importing parts for production would drive costs up, and outsourcing production would be even more expensive. It seems that if the deal does go through, it will be more on the basis of passion than prudence.