Global Acquisitions by indian firms puts India firmly on major economies

Tata Motors came into global limelight as an automobile major in early 2007 or even earlier when news of the cheapest world car was out of the tata's stable, Launch of tata nano (the $ 2500 car) turned all heds towards the tata motors and every major auto maker now want to replicate the same model but will never able to make a car even cheaper then the Tata's nano due to the cheapest input cost of nano, and the advantage with tata's is that they can use their own homemade steel for making the chasis of their vehicles which other companies have to purchase from other steel companies.
The launch of Tata Nano was much hyped so that the whole world notices the nano and Tata as a global automobile major with a surprise to come later in the year. the world never knew that the year 2007 was year of Tata Motors's brand acquisitions of the JAGUAR and LAND ROVER the iconic british car brands famous through out the world for their excellent cars in luxury car market.

Some still think that tats'a have played much bigger then they can by acquiring JAGUAR and ROVER car companies which were owned by the ford motor company of United states of America.

It may also be recalled that in 2007 the Toyota Motor Corporation surpassed General Motors to become World's number 1 automobile company. Now every car maker want to replicate the Toyota model to make their car company's revenue much larger and Tata's are no exception.

It took 3 decades for the japanese auto maker to enter into the luxury car market .

Toyota is the gold standard that aspiring auto-makers look to. Synonymous with Japanese quality, Toyota got to its premier position in the world auto stakes by a combination of production efficiency, high quality and delivering unsurpassed value to the customer. Toyota fans call a Honda, “a fake Toyota”, seemingly referring to Honda following in Toyota’s footprints and achieving similar status in terms of quality and value. Similarly while a growing company like Hyundai benchmarks its cars against Toyota competitors, a relatively “old-world” company like Volkswagen re-designed its production process based on inputs from Toyota engineers.

Still Toyota did not move beyond its economy and hence cheap image in the Western world till the introduction of its luxury brand, the Lexus. The strategy was such a success that other Japanese auto makers quickly jumped onto the bandwagon. The Lexus strategy had a curious side-effect on the overall Toyota bouquet of products. Unlike how the European companies built their luxury cars, Toyota continued to use the production line using strict quality control to drive efficiency. As a result the luxury cars did not cost significantly more than the regular line-up. While this revolutionized the luxury car market, it also worked wonders for its non-luxury line-up as the superior styling and finish of the luxury models began to rub-off on the rest of the portfolio.

Tata Motors has only taken baby steps towards becoming a global automaker. But the newly-acquired the availability of true luxury brands within the stable allows the company to learn what it takes to give its cars the aspirational value they need to succeed in the Western markets.

In addition to taking design lessons, Tata Motors can also benefit from the world-class R&D facilities, and an established global marketing network. Also while the Jaguar-Land Rover brand image will work wonders for Tata Motors’ own image, there is a danger that it would dilute the value of the British brands. So if the Tatas make it clear that they will treat the new companies as prized possessions that they will take pains to nourish and grow, while also using them as a huge opportunity to learn, then that should allay fears of brand dilution, while keeping the existing jobs and helping the Tatas as they build up their portfolio of vehicles to fill the gap between the SUVs and the luxury vehicles, in terms of both products and aspirational value.

So keep your fingers crossed and wait 2-3 years to see the technology of jaguar and rover brand embedded into indian made tata cars.