Just after Tata bought Jaguar - Land Rover off Ford in 2008, a world economic crisis struck. Ford had sold largely unprofitable brands and with the downturn, just in time. Ford has gone on to do well so they are happy. How about Tata though? Mr Tata seemed unfazed by it all, saying he was looking to the long term benefits. Well he didn't have to wait long as JLR have quickly and consistently been getting more profitable. What has been the reasons:
1) Getting and implementing professional advice on liquidity management.
2) Pursuing necessary cost cutting measures with the agreement of Unions.
3) Favourable currency fluctuations.
4) A general sales rebound in luxury cars.
5) The new XJ and revamping of other JLR models.
Of course, keeping the momentum going will be a challenge but a clear vision forward and continued investment are being actively dealt with. There are still problems getting enough engines and currency fluctuations overall have gone the other way of late. Despite these factors, the 2wd Freelander will undoubtedly be a winner in the beginning of 2011, as will the new Evoque due mid year. Jaguar will remain profitable but sales will climb only when new models come on stream sometime later.
All in all a surprising success story achieved within a much shorter time frame than I ever imagined. Ford did a fine job of sorting out many basic issues with JLR, but Tata and its astute team will now take it to another level.