We went too far with Jaguar Land Rover: Ratan Tata

Tata Sons Chairman Ratan Tata says he may have overstretched himself in paying 1.15 billion pounds for Jaguar Land Rover just as a recession loomed.

"If one had known there was going to be a meltdown, then yes [Tata went too far] but nobody knew," he told the Sunday Times newspaper in an interview.

Tata bought the iconic British car manufacturers for 1.15 billion pounds in April 2008 - just over a year after he paid 6.7 billion pounds for acquiring the steelmaker Corus.

"Both the acquisitions were made, I would say at an inopportune time in the sense that they were near the top of the market in terms of price," Tata said.

However, Tata squarely blamed the British government for not doing enough to help JLR secure credits to help it tide over the current slump in demand for cars, saying a further delay could torpedo plans to develop fuel-efficient hybrid cars and resurrect the Jaguar E-type model.

"I would like to see us coming out of the recession with these new products in place. What would be sad - remorseful - is if the meltdown continues and we can't get access to funds.

"I would like to see the British government playing only one role. It controls the banks and all I seek is the facilitation to provide access to credit on commercial terms. Its not a bailout," he added.

Tata, one of the largest foreign investors in Britain, warned: "We're responsible for the fortunes of the company but it is a bone-dry situation in terms of access to credit. Nobody can operate on that basis unless you have large cash balances, which we don't.

"My concern is that the government doesn't appear to care about manufacturing."

However, Tata exempted British Prime Minister Gordon Brown from criticism, saying: "He is a very sincere person and has been very supportive."

Corus and JLR together employ some 40,000 people but a global slump in demand for both steel and cars has seen Corus shut down facilities in Britain, laying off 5,000 staff and JLR making hundreds of redundancies.

Tata Housing | Ratan Tata: A Messiah for middle class

New channels and internet were abuzz with the talks of the new Tata ‘Nana’ housing project yesterday. It seems Ratan Tata has planned to tap the still neglected low cost product market (untapped in the sense that no known company has entered this sector). Be it the recently launched Tata Nano or the Tata Housing project at Boisar, about 120 kms from South Mumbai.
In a country like India, where we have such a large middle class, It is ought o the middle class deciding the future of a product in the market. It is the middle class which is going to make Tata Nano, a big hit or a flop and it was the same class which led to the record sales of Maruti 800. So, when you launch a product, you need to keep in mind this middle class. This middle class can also be easily divided into three categories: Upper Middle Class, Lower middle class and Typical Middle Class and lower middle class remains the biggest in number in the middle class segment.
So the products like Tata Nano and Tata housing are surely going to be a big hit amongst this segment, which lives in rented accommodations in these metros and dreams about having their own homes and obviously a car for the family. Ratan Tata has surely taken a big risk by entering this sector, but if it pays off, he will be become the best businessman ever, which India produced.
Which lower Middle class family can dream of having a home and car for just 5 lakhs, its like playing God and making their all dreams come true? With rents touching their all time highs, in normal circumstances, a middle class family pays around Rs. 3000-4000 per month for house rent and spends more than Rs. 2000 per month for commuting. So a family spends a total of around Rs. 6000 on housing and commuting. Calculating in normal mathematics, this family will spend Rs 5 lakh in around 83 months, if they pay same amount every month. But it is not the same, costs increase, inflation is always there.
For such a family buying a Tata house and a Tata car is going to be the first priority.