I thought this was a very interesting article in light of the recent difficulties Ford has been having. The sale of these two formerly British auto lines to an Indian company brings it back into the former Commonwealth Realm.
Would manufacturing move completely to Mumbai or would TATA keep some of the Ford sites around the globe to keep their distribution costs down? Engineering is one of the country’s greatest assets so having a local Indian company make a move like this is in many ways a logical evolution of the rapidly emerging economy in India.
Many people saw the outsourcing of the technology sector to India as a bane to the U.S. but the truth is – in my opinion- a healthy economy, a strong middle class, a diverse economy all in a democracy in a part of the world where the U.S. can use all the friends we can get is a good thing. I have worked with a number of Indian companies and they are nothing but completely serious about getting ahead and succeeding. The country still has more abject poverty than any American could imagine, but the spirit of hope and the knowledge that education and hard work can change your fate is what drives the Indian nationals toward the type of life we take for granted here in the U.S.
As more Indian companies look to enter the global market in more than just services, expect more news like this. The Indian pharmaceutical business is strong and poised to take off as the premiere supplier for the world’s generic drug supply especially in light of the horrific problems facing the Chinese pharmaceutical industry.
IT, drugs and automobiles. These are vastly different exports from the tea, rice and spices India was known for only 100 years ago.
Ford Continues ‘Focused’ Talks With Tata
Indian Automaker 1 of 3 Bidders for Land Rover, Jaguar
Published: January 03, 2008
DETROIT (AdAge.com) — Ford Motor Co. has gotten closer to a sale of its Jaguar and Land Rover brands.
The automaker today in a statement said it is “committed to focused negotiations” with Tata Motors, an Indian conglomerate and one of three reported bidders for the two storied British brands.
“There is still a considerable amount of work to do, and while no final decision has been made, we will proceed with further substantive discussions with Tata Motors over the forthcoming weeks with a view to securing an agreement that is in the best interests of all parties concerned,” Lewis Booth, exec VP-Ford of Europe, said.
Bids for brands
Published reports estimated the three suitors bid between $1.5 billion and $2.2 billion, but the final price could change when discussions start.
If Tata completes the deal, it would put the automaker on a global stage, as it currently makes small, affordable cars mostly for its home market.
Charlie Hughes, president-founder of consultant BrandRules and former longtime CEO of Land Rover North America, called Tata a very well-run, large corporation. “Their big concern needs to be how to keep these brands as prestigious, since they are not well known by luxury buyers anywhere in the world.”
Ford, which is trying to rebuild its core auto business, sold a majority chunk of Aston Martin for just less than $1 billion last March.
Ford acquired Land Rover from Germany’s BMW in 2000 for $2.7 billion and has enjoyed some success in the U.S., especially with its smaller premium SUVs. Land Rover said it sold 44,663 SUVs in the U.S. through November, 3,900 more than the same period a year ago. Land Rover spent $68 million in measured media in the first nine months of 2007, according to TNS Media Intelligence.
Jaguar’s sales slide
Ford has owned Jaguar since 1989, but got more involved in its operations this decade. In the U.S., Jaguar sales slid by nearly 5,000 units to 14,161 in the first 11 months of 2007 vs. the comparable period last year. Jaguar spent $20 million in measured U.S. media in the first nine months of 2007, according to TNS.
The two British brands are in Ford’s Premier Automotive Group, or PAG. PAG also includes Volvo, which Ford acquired in 1999. Ford CEO Alan Mulally said in the fall the automaker didn’t plan to sell Volvo, but he refused to rule out a sale in the future, according to Ad Age sibling Automotive News.