[AtlanticBlue99]

March 26, 2008:

NEW DELHI — Tata Motors, part of India’s fast-growing Tata Group, is buying Jaguar and Land Rover from the Ford Motor Company for $2.3 billion.

The purchase price is more than the market expected but still about half what Ford originally paid for the brands several years ago. The long-awaited deal, which was announced Wednesday, also carries a painful payout for Ford: after the sale closes, which is expected midyear — Ford will give Tata another $600 million to make up for shortfalls in the two brands pension plans.

Tata Group, one of India’s largest conglomerates, has been on an overseas acquisition spree, buying everything from tea and coffee companies to steel manufacturers. Other Indian companies are also considering overseas acquisitions, as a weak dollar coupled with strong domestic growth make takeovers attractive, particularly in the United States.

When Tata does deals, it rarely changes the character of the company that it buys over the near term.

Ratan N. Tata, the chairman of Tata Sons and Tata Motors, reiterated that strategy on Wednesday, saying the Tata Group “will endeavor to preserve and build on their heritage and competitiveness” of the two brands, while “keeping their identities intact.” No changes are expected to employment terms for the nearly 16,000 workers at Jaguar and Land Rover.

Ford is in the midst of a painful overhaul, shedding costly units and workers in the United States. The company chief executive and president Alan R. Mulally said in a statement that he was confident that Jaguar and Land Rover would thrive under their new owners. Ford’s were down 12 cents to $5.88 in late afternoon trading.

“Now, it is time for Ford to concentrate on integrating the Ford brand globally, as we implement our plan to create a strong Ford Motor Company that delivers profitable growth for all,” Mr. Mulally said. Ford has lost $15 billion in the past two years.

Ford will continue to provide some components, including power trains, to Jaguar and Land Rover, which are built in Britain, as well as some research and development support. Ford’s finance arm, Ford Motor Credit, will continue to provide financing to Jaguar and Land Rover dealers and customers for up to 12 months.

Source: New York Times

[mdvaldosta]

Been waiting on this to happen, now the world's cheapest car manufacturer owns to high end car companies. Wonder what that's gonna do for Land Rover and Jaguar? Doesn't seem very prestigious to be owned by the same company that produces $2500 cars.

[AtlanticBlue99]

I agree. And Land Rover and Jaguar are notorious for maintenance issues. I can only understand this as Ford's "bold" move to remain profitable by cutting deadweight enterprises. The quality of these high-end cars will be reduced, I am sure.

[cricket]

Wow...honestly. I have no words.

[nba1341]

good now ford can focus soley on ford and lincoln mercury and then of course mazada since it shares same platform on cars

[1FastFox]

Thailand: India-based Tata may build automobile manufacturing plant in Thailand


Section: Corporate News - Newspaper reports indicate BoI likely to giveapproval next week for aggressive auto firm to begin manufacturing in Thailand,The Nation reports. Indian auto-maker Tata Motors, following its takeover of Jaguar and Land Roverin the UK, will likely have one more achievement to cheer about. The Madras-based Business Standard daily newspaper reported there was alikelihood of Thailand's Board of Investment (BoI) approving the company'sproposal to manufacture eco-cars in the Kingdom. The move is part of plans by India's third-largest passenger-car manufacturerto expand into the global automotive market. The Business Standard quoted a BoI official as saying approval for Tata'seco-car proposal could be reached at the board's meeting next Wednesday. This would make Tata the fourth carmaker to win tax privileges under governmentplans to turn Thailand into a production centre for environmentally friendlyvehicles. The other three are Honda, Suzuki Motor and Siam Nissan Automobile. To win the tax privileges, auto-makers must commit to investing at least Bt5billion. Eco-cars are either petrol-fuelled vehicles with an engine size of nomore than 1,300cc or diesel-fuelled vehicles with engines up to 1400cc. Theymust not consume more than 1 litre of fuel for every 20 kilometres and mustemit no more than 120 grams of carbon dioxide per kilometre. A BoI official yesterday told The Nation that the agency would also likely toapprove proposals from Toyota and Mitsubishi, while that from Volkswagen wouldbe delayed. Tata managing director Ravi Kant yesterday confirmed in Bangkok that Tata hadconcluded a deal to acquire the two British brands for US$2.3 billion (Bt72.47billion). He went on to discuss the eco-car project. "The eco-car is a very important segment of the market for Tata," Kant told theThai media. "We'll consider which car will be appropriate for the Thai marketafter proper research in Thailand." Tata makes the world's cheapest car, theNano, for the Indian market. It promises a fuel economy of about 20km perlitre, which fits BoI specifications. On the acquisition of Land Rover and Jaguar from Ford, Kant said: "These twocompanies have lots of potential, and we will allow them to operate bythemselves. Although the market in the US might be down, there are othermarkets that can offset this loss. We have looked at the business plans of bothcompanies for the next five years and are satisfied with what we see." Kantsaid he believed his company had settled on a good price. However, whether thecompanies will enter the Indian market will be a matter for each one'smanagement. Asked why Tata decided to buy the companies when the US market was not doingwell, he replied that Tata was given no choice. "Ford decided to sell the companies now, and we had to take advantage of theopportunity. The automotive trade is cyclical. The markets will bounce back ina while. We have been doing business for 60 years at Tata and know this onlytoo well," he said, adding that action would be taken to mitigate thecompanies' risks. With its acquisition of Jaguar and Land Rover, Tata's total international salesnow exceed its domestic sales in India.

[GennyD]

interesting... hmmm

[06RedfireGT]

Jaguar and LR just became Hyundais *L*

[LV51FER]

Imagine how we in the UK feel. One minute, Rover are trying to rescue themselves with Tata's aid and get the crappest car ever made in the shape of the Tata Indicar which became the City Rover (or something that rhymes with it). Next thing, Rover goes east and is sold to the Chinese.

Ford come along to rescue Land Rover, Jaguar and Aston Martin, get them all into fine fettle, flog Aston to a conglomerate and donate all the fruits of the Jaguar and LR labour to India. Talk about The Empire Strikes Back!

Incidentally, though both aguar and LR have had issues with quality in the past, they both come right at the top of more recent surveys including your own JD Power.

I wouldn't worry too much about Jag and LR becoming poorer cars because mosty manufacturers appreciate that part of these cars' cachets are the British aspect hence Astons, Bentleys and Roll-Royces and even the Mini are still built in the UK which is more than you can say for the German marques which are being built in places like Hungary to take up the cheap labour and production costs.

So I think production will remain in the UK in order to preserve the prestige aspect of the marques. It's not like Chevy who stick their name on any old Daewoo.

[mattstang]

just like harley and amf. two companies that shouldnt be working together.

[RememberMorrison]

Tatas! Yummy. Motorboat.

[Dennis-96GT]

well the landrover was found to be the #1 car out to be sent to the shop within the first year. i expect the quality of both cars to diminish drastically. or i see them going down in price due to cheap labor and become a everyday working mans cars

[RememberMorrison]

I miss the old Land Rover farm trucks, like the Defender Series. My grandfather has a Defender 110, that thing is a tank. Such a cool truck.

[deedub97GT]

the only LR or jags even worth it any more are the 15+ year old ones

[GTsetGO]

ahhhh, love the rich man's car. you have to have money because they cost 4 times as much to maintain them then they do to buy them.