The acquisition of the two marquee brands Jaguar and Land Rover, may well signify a coming of age for Tata Motors, which has already made a mark for itself on a global scale with the Nano. JLR would ensure that the company emerges as one of the most diversified in the sector, having the cheapest $2,500 car as well as one of the most expensive Jaguars in its portfolio.

“Tata motors benefits from this acquisition in more ways than one. It will now get access to newer markets and distribution networks, better technology and diversified manufacturing locations while its product line gets enlarged like never before,” said Society of Indian Automobile Manufacturers director general Dilip Chenoy. Tata Motors, whose passenger car division is not even a decade old (the Indica was launched in late 1998), has already made a splash with the Nano, first in India in January and then in Geneva earlier this month. “This (JLR) deal will definitely position Tata Motors firmly on the global map and I do believe the company has aspirations of being recognised as an international brand. It also signifies confidence in Indian managerial talent and in Ratan Tata because such acquisitions need capital infusion, which comes through financial institutions,” said TNS automotive vice-president Pradeep Saxena. “People are willing to put in money on the venture even though they were not bullish about JLR individually.”

Over the years the Tata group has thrived through the M&A route and with its automotive arm, Tata Son’s chairman Ratan Tata is merely trying to replicate the success. Analysts believe that with the JLR, a liability to Ford with losses of over $ 10 billion over the years, Tata Motor’s wont find the going very easy. For one, the company seems to have its hands full and the high operation costs of the two brands will really test it. While launching Nano itself would be a task, the company has planned a spate of other launches, including a new range of Indica and Indigo. Further, the scope of the two brands to succeed in India would be limited, given the country’s abysmal per capita income.

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