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Home arrow Automotive arrow Tata Motors Identifying Sources of Components for JLR in India
Tata Motors Identifying Sources of Components for JLR in India Print E-mail
Written by Anand, Anita   
Friday, 14 August 2009
Mumbai: The working relationship between Tata Motors and Jaguar Land Rover (JLR) has been continuously evolving during this first year of acquisition.

"Considerable progress has been made in identifying sources of components from India, recognizing engineering and Computer Aided Design capabilities within Tata Motors and marketing synergies in various geographies," states Ratan Tata.

"Tata Motors on the other hand has recognized the high level of technology and skills embedded in JLR which could be of great value to both companies."

Jaguar and Land Rover have 3 major manufacturing facilities and 2 advanced design and engineering centres in U.K.

"Tata Motors recognized that the two global brands, Jaguar and Land Rover, needed to retain their identity, design and technical independence as also their image in the marketplace, while at the same time integrate with the management of Tata Motors, and find synergies in the capabilities and facilities between the two companies," he remarks in the Tata Motors 2008-09 annual report.  

New technology development programs at JLR

JLR is involved in the development of a hybrid powertrain which will be introduced in future models of Jaguar and Land Rover. JLR is also planning to have all its future cars constructed with light weight aluminum bodies resulting in considerable savings in weight, and reduction in CO2 emissions. Land Rover has received a grant offer of £ 27 million to build a new small Range Rover at its Halewood plant.

Loan from the European Investment Bank expected soon

Meanwhile JLR has improved working capital, and reduced inventory, investments, and payroll costs through manpower cuts of over 2000, in response to a 32% drop in volumes in the 10 months post acquisition, which resulted in a Loss Before Tax of GB £ 281 million. A long term loan from the European Investment Bank (EIB) of GB £ 340 million, sanctioned to Jaguar Land Rover, is expected to be successfully secured in the coming weeks through appropriate commercial arrangements. The arrangements are expected to be concluded without necessitating guarantees from the UK Government.

In June 2008 Tata Motors completed acquisition of Jaguar Land Rover (JLR) from Ford Motor Company (Ford) of USA for a net consideration of US$ 2.3 billion. 

The purchase consideration included the ownership by Jaguar and Land Rover of necessary Intellectual Property Rights, 3 major manufacturing facilities, 2 advanced design and engineering centres in U.K., a worldwide network of 20 national sales companies and a minimum assured capital allowance of approximately US$ 1.1 billion for future tax set-offs.  JLR also tied up with Ford for supply of engines, stampings and other components on a long term basis for its business, as also for transition support in areas of auto financing, IT, accounting and access to Ford's testing facilities.

Last Updated ( Friday, 14 August 2009 )
 
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