Ever since Tata motors acquired Jaguar Land rover the brand's presence has been growing tremendously in India, the brand has found so much love in India that even the prime minister ditched his BMW 7 series security and rolled up in a black Range rover hse for Independence Day celebrations in 2010.
After Narendra Modi secured a second term in office in April 2019 he upgraded to a Range rover sentinel which is fort Knox on wheels. Although jaguar land rover has become more reliable since Tata took over and initially seemed to be doing very well things have changed since and not for the good.
In the first financial quarter Tata reported a massive 27,000 crore one-time loss due its impairment. Tata motors blamed the decline of sales in china. Tata predicted a 14% profit but were only able to deliver 6.9%. However markets us continued to increase along with a strong domestic market, it was however in Europe where Tata motors suffered after china, due to a fall in demand for jlr vehicles.
LAND ROVER USED TO BE OWNED BY BMW FROM 1994 TO 2000 .WHEN FORD BOUGHT IT FROM THEM.
JAGUAR WAS BOUGHT BY FORD IN 1989 AND WAS PLACED IN THE PAG GROUP UNDER THEN CEO JACQUES NASSAER.THE PAG GROUP CONSISTED OF 4 BRANDS ASTON MARTIN, LAND ROVER, JAGUAR AND VOLVO.THIS LASTED UNTIL 2010, WHEN IT WAS SLOWLY DISMANTELED UNDER A NEW CEO, ASTON MARTIN WAS SOLD TO A CONSORTIUM IN 2006, JAG
AND LAND ROVER TO TATA IN 2008(for 2.7 billion) AND FINALLY VOLVO TO GEELY IN 2010.
Tata bought these brands at low point in their history as both the brands were facing reliability issues and falling sales and was bought shortly before the 2008 financial crisis.
Tata were able to make both the brands money-makers which brands had failed to do before, they did this by giving jlr money and left them alone. It paid off. Tata was not only able to improve the design and technology but more importantly quality. This improvement in quality finally made them comparable to bmw, Audi, and Mercedes. Things seemed good until 2017. In 2018 three posted a loss of 4.5 billion dollars for the fiscal year of 2019.
This has resulted in a 63% fall in shares, with S&P cut its credit rating lowering it to almost junk. Along with the fall of sales in the Chinese market, trouble in Europe is brewing as well. Due to brexit the prices might rise even higher due to 40 % of the manufacturing materials coming from the UK. The s&p credit rating might fall even lower if there is no deal brexit.
JLR does its best business in North America, which is a very hungry suv market. Land rover is the stronger brand, jaguar have sedans and sports cars in their portfolio but even they have introduced suvs .jlr have sold 10 times the number of suv compared to sedans. last year jaguar alone sold double the amount of suvs compared to their cars .jaguars suvs have faced very favourable reviews and interest from customers . Their electric vehicle I pace was praised by critics and consumers alike and it swept the world car awards at New York international auto show in 2019. However the North American market will not be enough to sustain jlr.
THE EASIER OPTION IS TO SELL JLR (INTREST FROM PSA GROUP IS STRONG WHO ALSO BOUGHT OPEL AND VAUXHALL).
However given the history of Tata, its well-known they do not back down from a fight and a switch to electric SUV would not only save the brand but also secure its long term survival but would also help it thrive in the future.