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Business

Tata - India’s “East India Tea Company”?

By: Karthik :+: Under: Business, Cars, Sarcasm
On: ⋅ July 21, 2007 ⋅  Email this post ⋅  Print this post ⋅ Post a comment
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Land Rover could soon be Tata’s luxury division.

It looks like India’s “East India Tea Company” will be Tata.

Although the official word is mum, Tata Motors and Mahindra have been linked with possibly bidding for Ford’s Land Rover and Jaguar divisions. Both brands are currently owned by Ford, what needs to be remembered is that these are iconic British brands. It has been rumored that Tata has signed a confidentiality agreement with Ford about the deal. At a cost of about US$1.5 Billion, this could be an expensive investment for Tata.

India’s Tata Motors Ltd. and Mahindra & Mahindra Ltd. are exploring the possibility of bidding for Ford Motor Co.’s Jaguar and Land Rover brands, the Economic Times reported on Thursday.
he Daily Telegraph newspaper had earlier reported Tata Motors had instructed advisers to evaluate the merits of a joint offer for Jaguar and Land Rover, valued at about $1.5 billion.

It had said Tata Motors’ evaluation of a bid was at an “exploratory” stage and may not lead to a formal bid.

Exploratory or not, I think it is the right time for Tata to expand. Land Rover makes a lot of sense given Tata’s experience with SUV’s and could very well be it’s luxury SUV brand. Since these vehicles practically sell themselves in many parts of the world, Tata would not have much of a problem.

Now Jaguar is a different ball game altogether. Tata has no experience in selling luxury cars and this could be a challenge. Having said that Jag’s are an easier sell than Land Rovers, time will be the judge.

I am not talking about Mahindra because I doubt they have the financial backing necessary, well unless it is going to be a joint partnership with Tata.

But Jaguar and Land Rover are expected to attract limited interest, sources have told Reuters. Initial indications of value are due to Ford on July 19, they have said.

Given the fact that there is “limited” interest, Tata might actually end up Land Rover in its stable. The question on everyones mind is what next?

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