Tata made headlines in the world's newspapers and business magazines when it agreed to purchase Jaguar and Land Rover from Ford at the end of March. As the Oakland Pressnotes the possibility of a deal had been in the news since January. The article also says the deal is the first signal of Tata's "arrival as a true global automaker."
Ratan N. Tata, the ambitious chairman of Tata Sons Ltd. and Tata Motors, had already grabbed headlines in January, when he unveiled the $2,500 Nano, which is already having a major effect on the thinking of other carmakers around the world.
Michael Robinet, vice president of forecasting services for CSM Worldwide Inc. of Northville, said the Nano offers Tata an opportunity to reach a "virgin segment" of buyers not served by any other manufacturer. "The people it is aimed at were riding mopeds," he said.
The unveiling of the Nano fulfilled the commitment by Ratan Tata, who had nurtured the project in the face of universal skepticism about whether he could put an inexpensive vehicle on the road. "It's a car that is affordable, provides transport, meets all safety norms, emission norms -- present and future -- and will be a reliable form of transport and will provide Indian families an 'all-weather' means of safe transport," he said after the car was introduced.
Tata has now turned up the heat on its competitors, Robinet said. Rivals will either have to try to match the Nano or leave the segment to Tata. The core of the Tata Motors engineering team worked in secrecy for more than three years, and the price target was reached by improvisation and not by cutting corners on essentials, Robinet said after the Nano appeared in January.
Ford shareholders were probably happy to see Jaguar go. Marketwatch wrote ahead of the deal that "a potential deal would finally mark an end to a costly marriage that spanned 20 years of losses and declining sales at Jaguar." Those costs and problems will now belong to Tata. It will be interesting to see what the Indian auto manufacturer is able to do with Jaguar, Land Rover and their cheap Nano line. Will Tata emerge in five to ten years as one of the automotive leaders or will they struggle to keep up with demand or get mirred in costs with Jaguar like Ford did?
