The recovery of the two British brands, particularly that of Jaguar, “is well on its way,” insisted C. Ramakrishnan, the chief financial officer of Tata, during a conference call with automotive analysts – which TheCarConnection.com was also invited to attend.
The formal handover of Jaguar and Land Rover will depend upon regulatory approval, the Tata CFO stressed, though he said he didn't expect any problems winning approval. Once the brands are part of the fast-growing Indian conglomerate, things will largely operate as they have been, in recent months. Most of Jaguar and Land Rover’s mid to upper management has agreed to remain with the company, said Ramakrishnan. And though Tata will oversee operations, the Indian company “proposes to manager Jaguar and Land Rover as an independent entity and independent brand,” he assured his audience.
Acknowledging that the two luxury makers, Jaguar, in particular, have had their problems, Ramakrishnan nonetheless insisted that Ford has already put into place most of the necessary “building blocks” for a turnaround. The U.S. maker has also agreed to provide ongoing assistance to its two former marques. It will continue to supply parts and build engines for the two nameplates. In addition, Ford Motor Credit will still provide loans to Jaguar and Land Rover customers.
In recent years, Ford declined to break out specific financial figures for its subsidiaries, but Ramakrishnan insisted that the brands are “healthy and profitable.” He boasted that both marques were profitable “in all quarters of 2007,” though he declined to provide specific numbers.
Jaguar sales have been turning up, with the arrival of new models like the XK and XF, while Land Rover hit a record 233,000 sales in 2007, up from 192,000 the year before. Yet that doesn’t mean all is well, the Indian executive conceded.
Both makers are particularly dependent upon the U.S. market, which accounts for roughly a third of all Jaguar and Land Rover volume, so the current economic downturn poses a potentially serious threat.
So, looking ahead, Ramakrishnan said a key goal, for Tata will be “spreading our risks over different segments and different geographies.” In particular, his company hopes to fuel future growth by targeting newly affluent buyers in emerging markets like India and China.