Big Sis in their Jag

Written by Sanjoy Mazumder | Updated: Mar 30 2008, 03:41am hrs
So, the much anticipated buyout of Jaguar and Land Rover (JLR) has finally taken place. At a price that many are calling a bargain, since Tata paid only a third of what Ford shelled out. But in becoming the proud owner of two of Britains, and possibly the worlds, most iconic brands, Tatathe torch-bearer of Indian business ambitionhas perhaps crossed yet another invisible line.

In the West, Indian business has always been associated with a hardy efficiency and work ethic symbolised by the cheap and cheerful trade of the corner shop, the sweatshop and lately the call centre. Even Tatas acquisition last year of the mega Anglo-Dutch steelmaker Corus alongside beloved brands such as Tetley Tea and hotels such as the stately Boston Ritz caused a ripple but not caused much of a sensation outside business circles.

But Tatas latest acquisition has moved it off the high streets of brand snobbery to the rarefied clubs. Jaguar, in particular, is one of Britains ultimate social symbols, signifying old-world wealth and gentilitymore Inspector Morse than 007 (the pretender who has to make do with Aston Martins). Its also the choice of successive British prime ministersthe definitive British luxury saloon.

Land Rover, on the other hand, is the worlds original SUV. Long before the Land Cruiser, it was the vehicle of choice for khaki-clad aid workers, UN officials and associated do-gooders in Africa, South America and other parts of the developing world. Like Jaguar, it is enshrined in British history. It was a product of the post-war years, and the original Land Rovers were built of an alloy of aluminium and magnesium, in part because of the plentiful supply of aircraft aluminium following World War II. Its one reason why the early models were predominantly painted in military green.

Not surprising, then, that it also became the choice of testosterone-driven males way before the world had even heard of the Hummer. Even Queen Elizabeth II was seen driving one through the Scottish highlands in the movie, The Queen.

Thats probably why Tatas very public and lengthy bid for these two auto brands have raised the companys profile in the West, particularly Britain, like never before. From radio programmes discussing the pronunciation of the name Tata to a dissection of what the word means, the airwaves and newsprint have been full in the past few months. Much is being made of the fact that in many European languages, the name Tata means father or big sister. Appropriate, given the role the company now has to take on.

The fact that the brands have long outlived the utilitarian value of the two vehicles is probably the reason that the ever reticent Ratan Tata declared publicly that he will endeavour to preserve and build on their heritage and competitiveness, keeping their identities intact.

After all, sales of Jaguar have halved over the past five years. And despite a widespread belief that nearly 75% of the original 1950s model of the Land Rover are still on the road, it has slowly yielded to the more reliable and better supported Japanese Land Cruisers, Pajeros and Nissan Patrols.

So, while Tata may have committed to keeping the existing production facilities in place and also to keeping the brands alive, itll have to find ways to regenerate the world markets faith in them.

But even more than the snob value of Tatas acquisitions, their real impactand by extension the global appreciation of Indian industrymay be in how the purchase has been received in working class Britain. The Tata bid was widely welcomed by the unions and factory workers at the Jaguar and Land Rover plants, mostly concentrated in the British Midlands, an area that also happens to have a major Indian population. To be fair, they had little to choose from, since the Tata offer was by far their best hope of holding on to their jobs.

So, one of Indias oldest and most revered business houses, the countrys largest private employer, is now the hope of British factory workers who recognise that it has the manufacturing expertise and background to take them on. The fact that Tata has also pledged 300 million pounds into their pension schemes is also a major factor.

But lets be clear about one thing. Tata is not about to sell container loads of Jaguars and Land Rovers back home in India. This is its biggest foray into the global car market, which means its in for a bruising battle with the Japanese majors as well as the German Mercedes, BMW and Audiall of whom are much bigger and at the moment certainly better.

Tatas predecessor, Ford, threw in the towel when it simply became too expensive. Ultimately, it recognised that the legendary brands had to be passed on to someone with deeper pockets.

So, Tata, and India, have a lot to be proud of. But make no mistakethe test lies ahead.

Sanjoy Mazumder is India correspondent, BBC