Tata Motors & Jlr Acquisition

Topics: Tata Motors, Ford Motor Company, Automotive industry Pages: 7 (1825 words) Published: July 23, 2013


Table of Contents
Executive Summary3
SWOT Analysis of Ford Motor Co5
Business Strategy of Ford6
SWOT Analysis of Tata Motors7
Why Acquisition9
Future study9

Executive Summary:
This project aims at analysing the acquisition of Jaguar Land Rover by Tata Motors. Jaguar and Land Rover brands were held by Ford Motor Company. Ford had acquired Jaguar in 1989 and Land Rover in 2000. This project analyses the causes of selling of both the brands by Ford at a price half of what it had paid to acquire them. Further this project looks into the strategy behind Tata Motors acquiring these global brands. Tata Motors were in a process of expanding their global presence through various mergers and alliances. They had alliances with various international firm for mutually beneficial purposes. In this background, acquiring Jaguar Land Rover is of high importance in their strategy. It further studies the synergies between the firms and critically analyse the acquisition decision. The gains for both the firms from a merger are studied. The post-merger operation strategy and performance is also taken up in the study. It has been observed that though the immediate effect on the share values and financial ratings were negative, in due course the deal has proved to be highly beneficial.

Tata Motors a subsidiary of Tata group was founded in 1945 as a manufacturer of locomotives. They entered Commercial vehicle sector in 1954, entered passenger Vehicle market in 1991, launched Indica in 1998, acquired Daewoo’s truck manufacturing unit in2004,Acquired 21% stake in Spanish bus and coach manufacturer Hispano Carrocera in 2005, Established a JV with Brazil based Marcopolo, in 2006 for building buses and coaches. The Vision of Tata Motors (Passenger Car Business Unit) is “To develop Tata into a world class Indian car brand for innovative and superior value vehicles. The decision to acquire Jaguar and Land Rover was in line with this vision. Jaguar and Land Rover business was first united under Ford Motor Company. Ford acquired Jaguar in 1989 and Land Rover from BMW in 2000. Jaguar Land Rover was acquired by Tata Motors in 2008. This project aims at analysing the acquisition of Jaguar Land Rover by Tata Motors. Objectives of the Project:

Through this project we try to analyse and answer the following question * What are the Core competencies of Jaguar Land Rover and Tata Motors? * Why both companies went for an acquisition?

* What are the advantages both companies expect from this acquisition deal? * What are the values added to both companies due to this deal? * How to evaluate the deal?
The Strategic decisions which are discussed in this report and which Tata Motors and Jaguar Land Rover face are * What are the strategic alternatives available for Tata Motors and Jaguar Land Rover at that point of time? * Was the decision to acquire a right one considering the situation? * How does this decision affect the companies in the long run?

The Global Automotive Industry was dominated by Ford, General Motors, Toyota, Volkswagen and Renault. Ford dominated the markets in the 1970s and 1980s. But in the 1990s the scenario had changed and Ford Motor Company started facing financial trouble. The profits declined drastically. Various factors have accounted for the poor performance. The SWOT analysis of Ford highlights on the company strengths and weaknesses and the future growth potential for the company.

* Well established markets in Europe, North America , South America and other geographical areas * Presence of brands like Aston Martin , Jaguar, Land Rover and Rover Weaknesses
* Business Integration Strategy – Ford 2000 strategy
* Lack of...
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