Now, the world’s cheapest car moves into the third gear. 
With access to high-end diesel technology, and several options to locate its ‘cheap car’ factory (or assembly units), the Tatas seem to have got their back-end in place. Simultaneously, they had to look at the front-end; after all, Tata Motors wanted to sell the Rs.1 lakh car in as many markets as possible. It was meant to be a global car for global consumers. It is in this context that the Jaguar-Land Rover deal will immediately help it to tap the European market.
The Jaguar-Land Rover buyout becomes critical as the Tatas have failed to make a mark in foreign markets in the past. Prominent signage on the Team Jordan’s Formula 1 car preceded Tata’s exports of Indica to the UK; the car was marketed under the City Rover brand name. Even though the car did not do too well, it did give Tata Motors a foothold in Europe. Today, the company has agreements in various European nations to assemble the Tata Safari SUV, among other products. Sponsoring Narain Kartekeyan, India’s first F1 driver, was also a step to establish the Tata brand in Europe.
As you have probably realised, the Rs.1 lakh car has moved into fourth gear, and you are cruising at 60 kms an hour. But just drive along, as the puzzle is still not complete. The last few pieces have to still fall into place. Only then will you be able to figure out the real design behind the several decisions taken by Ratan Tata to turn his ‘small car’ dream into reality.
Despite being loss-making (see box), Jaguar and Land Rover are perceived as exclusive and high-end European brands. Even if Tata Motors gives full management autonomy to the acquired businesses, and sells their products the same way as Japan’s Toyota does with Lexus (without lending its name to reduce any form of brand dilution), it will still earn brownie points. The two European brands will help establish Brand Tata, at least in Europe. They will additionally help the Indian car maker to combat any moves by China to manufacture its own version of the world’s cheapest car.
“Tata Motors has a better image then the Chinese as it has a history of manufacturing, and has already acquired brands like Tetley and Corus,” says Autocar India’s Ashish Masih. It’s time to move into fifth gear. Tata Motors now has the technology, low-cost manufacturing options, access to developed markets, and a globally-recognised brand name. It is all set to launch the Rs.1 lakh car, which will be unveiled at the Auto Expo. Every cog in the design-manufacturing-marketing-branding wheel is in place.
So, while the world’s cheapest car is breaching the 80 kms an hour mark, it’s time to take a ride in another vehicle, the Tata Motors’ SUV. For years, Tata wanted to do an Indica with his range of SUVs. But Tata Sumo and Tata Safari have never been perceived as low-cost, entry-level, but stylish vehicles. Another Indian competitor, M&M, has done wonders with its Scorpio. Foreign players like Toyota too have fared much better. In the high-priced SUV segment, Tata hasn’t been able to make any inroads.
Land Rover will be a coveted catch for Tata as the brand represents one of the most-sought after SUV. The recently launched Range Rover and the updated Disco models have done well and can provide Tata with a platform to ride the international markets. Tata Motors may sell its products along with Land Rover’s, thereby amplifying both the visibility and reach of the indigenous SUVs. Before you think that it is not worthwhile to associate with a loss-making brand, listen to Ford UK’s John Gardner.
“The Jaguar-Land Rover business has been a profitable one in recent times; 2007 has been best ever year for Land Rover, better than 2005 and 2006.” This implies that Land Rover can effectively be used as a brand extension. Masih agrees, “Tata Motors will get access to better technology from Land Rover that can help the former to reposition its SUVs in higher segments.”
For Complete IIPM Article, Click on IIPM Article
Source : IIPM Editorial, 2008
With access to high-end diesel technology, and several options to locate its ‘cheap car’ factory (or assembly units), the Tatas seem to have got their back-end in place. Simultaneously, they had to look at the front-end; after all, Tata Motors wanted to sell the Rs.1 lakh car in as many markets as possible. It was meant to be a global car for global consumers. It is in this context that the Jaguar-Land Rover deal will immediately help it to tap the European market.The Jaguar-Land Rover buyout becomes critical as the Tatas have failed to make a mark in foreign markets in the past. Prominent signage on the Team Jordan’s Formula 1 car preceded Tata’s exports of Indica to the UK; the car was marketed under the City Rover brand name. Even though the car did not do too well, it did give Tata Motors a foothold in Europe. Today, the company has agreements in various European nations to assemble the Tata Safari SUV, among other products. Sponsoring Narain Kartekeyan, India’s first F1 driver, was also a step to establish the Tata brand in Europe.
As you have probably realised, the Rs.1 lakh car has moved into fourth gear, and you are cruising at 60 kms an hour. But just drive along, as the puzzle is still not complete. The last few pieces have to still fall into place. Only then will you be able to figure out the real design behind the several decisions taken by Ratan Tata to turn his ‘small car’ dream into reality.
Despite being loss-making (see box), Jaguar and Land Rover are perceived as exclusive and high-end European brands. Even if Tata Motors gives full management autonomy to the acquired businesses, and sells their products the same way as Japan’s Toyota does with Lexus (without lending its name to reduce any form of brand dilution), it will still earn brownie points. The two European brands will help establish Brand Tata, at least in Europe. They will additionally help the Indian car maker to combat any moves by China to manufacture its own version of the world’s cheapest car.
“Tata Motors has a better image then the Chinese as it has a history of manufacturing, and has already acquired brands like Tetley and Corus,” says Autocar India’s Ashish Masih. It’s time to move into fifth gear. Tata Motors now has the technology, low-cost manufacturing options, access to developed markets, and a globally-recognised brand name. It is all set to launch the Rs.1 lakh car, which will be unveiled at the Auto Expo. Every cog in the design-manufacturing-marketing-branding wheel is in place.
So, while the world’s cheapest car is breaching the 80 kms an hour mark, it’s time to take a ride in another vehicle, the Tata Motors’ SUV. For years, Tata wanted to do an Indica with his range of SUVs. But Tata Sumo and Tata Safari have never been perceived as low-cost, entry-level, but stylish vehicles. Another Indian competitor, M&M, has done wonders with its Scorpio. Foreign players like Toyota too have fared much better. In the high-priced SUV segment, Tata hasn’t been able to make any inroads.
Land Rover will be a coveted catch for Tata as the brand represents one of the most-sought after SUV. The recently launched Range Rover and the updated Disco models have done well and can provide Tata with a platform to ride the international markets. Tata Motors may sell its products along with Land Rover’s, thereby amplifying both the visibility and reach of the indigenous SUVs. Before you think that it is not worthwhile to associate with a loss-making brand, listen to Ford UK’s John Gardner.
“The Jaguar-Land Rover business has been a profitable one in recent times; 2007 has been best ever year for Land Rover, better than 2005 and 2006.” This implies that Land Rover can effectively be used as a brand extension. Masih agrees, “Tata Motors will get access to better technology from Land Rover that can help the former to reposition its SUVs in higher segments.”
For Complete IIPM Article, Click on IIPM Article
Source : IIPM Editorial, 2008
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