Since its acquisition by Tata motors, the performance of the erstwhile fading but iconic British brand Jaguar Land Rover (JLR) has been nothing short of amazing. From being on the verge of turmoil and a looming threat of factory closure coupled with dismal performance in a majority of its markets, JLR was in an extremely precarious position prior to its acquisition. Tata Motors, took the bold decision to saddle itself with a debt of Rs.21,900 crore, an uncomfortable position for a company that had been virtually debt free. Nonetheless, within a span of six years, JLR was metamorphosed into the fourth best selling luxury car maker through Tata’s meticulous planning. The dramatic turnaround made JLR a mainstay of Tata Motor’s finances due to
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Firstly, there was a strategic dimension involved. Executives at Tata acknowledged the fact that the acquisition would enable Tata to overcome high entry barriers in foreign markets allowing them to make a mark in the international arena. This was of significance since Tata Motor’s foothold was strong only in India and the deal would bring them up to a different level with respect to becoming a global passenger car company. Secondly, the deal would give them access to better technology and a much broader design portfolio consisting of both luxury as well as value-for-money cars. JLR employed high end technological standards and Tata believed that these could be put to use to make their production line more efficient. Additionally, Tata was confident that it could profit from a broader line of consumers – middle income consumers through its existing product line up and higher income consumers through JLR’s …show more content…
For instance, it did not seek to run JLR from Tata headquarters in Mumbai but instead assigned the English executives to oversee day-to-day management. It therefore applied separation strategy and equipped JLR’s managers with decentralized decision making powers. This separation however, was insufficient for an effective and successful post-acquisition integration process to take place. An understanding of the manner in which each company carried on its business was equally important and Tata’s executives realized this at an early
Firstly, there was a strategic dimension involved. Executives at Tata acknowledged the fact that the acquisition would enable Tata to overcome high entry barriers in foreign markets allowing them to make a mark in the international arena. This was of significance since Tata Motor’s foothold was strong only in India and the deal would bring them up to a different level with respect to becoming a global passenger car company. Secondly, the deal would give them access to better technology and a much broader design portfolio consisting of both luxury as well as value-for-money cars. JLR employed high end technological standards and Tata believed that these could be put to use to make their production line more efficient. Additionally, Tata was confident that it could profit from a broader line of consumers – middle income consumers through its existing product line up and higher income consumers through JLR’s …show more content…
For instance, it did not seek to run JLR from Tata headquarters in Mumbai but instead assigned the English executives to oversee day-to-day management. It therefore applied separation strategy and equipped JLR’s managers with decentralized decision making powers. This separation however, was insufficient for an effective and successful post-acquisition integration process to take place. An understanding of the manner in which each company carried on its business was equally important and Tata’s executives realized this at an early