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      Jaguar Land Rover guides Tata Motors on the road to recovery

      CarTrade Editorial Team

      CarTrade Editorial Team

      Tata Motors has been one of the major car makers that share long historical roots in the Indian car market. Over the years, the company has garnered the attention of Indian buyers and has performed as per the expectations. However, in the recent past, the growth of Tata Motors has been dogged down by the declining demand for passenger cars in the country. Since the beginning of 2013, the sales of vehicles manufactured by Tata Motors has not stabilised. It was recently that the Indian home grown major announced its passenger car sales for November in which the company reported a decline of almost 39 per cent. According to estimates, this sharp dip in domestic sales was the lowest ever for Tata Motors in three years.

      Jaguar Land Rover guides Tata Motors on the road to recovery
      Jaguar Land Rover guides Tata Motors on the road to recovery
       

      However, as far as global sales of luxury brand Jaguar Land Rover are concerned, they are showing a rosy picture for the company. In October 2013, the demand for cars increased by 29.6 per cent to 36157 as compared to year-ago performance of 27897 units. Jaguar and Land Rover has majorly contributed to the fortunes of Tata Motors ever since the Indian major decided to buy out the ailing luxury car brand. At that time, a few would have predicted that this deal would be beneficial for Tata Motors as the UK-based manufacturer was in all sorts of trouble. The irony is that the main sales driver of Tata Motors at present is Jaguar Land Rover, on the global front, which is making constant inroads in major overseas markets.

      Based in UK, Jaguar Land Rover has been cherished by many because of the long historical roots and impressive quality of products. Before Tata Motors, Jaguar was owned by Ford Motor Company while Land Rover was controlled by BMW. During the tenure of Ford, the sales of Jaguar brand did not pick up in U.S. as the parent company was itself caught off guard against the rigours of the market conditions. It was in 2008 that Tata Motors finally decided to buy both the brands from Ford Motor Company for 2.3 billion dollar. After the takeover, trade analysts were of view that Tata Motors have made the wrong decision to overtake Jaguar Land Rover as it might lay a significant impact on the profits of the company. Furthermore, it was said that Tata Motors would find it hard to manage the expenditure incurred on restructuring both the foreign brand.

      However, after almost 5 years it is quite hard to imagine that once redundant Jaguar Land Rover would help Tata Motors to stay in profits. In the Indian car market, the passenger cars of Tata Motors have not performed as the company would have hoped for in the last couple of years. On the other hand, Jaguar Land Rover brand is getting a major thrust from emerging markets like China and Russia, where it has build upon a good consumer base. Owing to this, Tata Motors raked in Rs. 3542 crore profit in the recently concluded financial year. In the second quarter of the financial year that ended in September, Jaguar Land Rover alone posted a net profit of 507 million pounds, an increase of 40 per cent as compared to same period last year. Going by the above statistics and figures, it can be ascertained by how much Jaguar Land Rover has impacted the fortunes of Tata Motors.