Quote:
Originally Posted by iraghava  Problem is not managing takeovers but managing & reviving a nearly-dead Luxury car maker. Trust me, this is harder said then done especially given the condition that Jag & LR are in today.
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Remember, if BMW & Ford could not make these companies profitable & run them, there's got to be a good reason behind it. |
I am sure TATA is not trying to revive the Jag brand and make profits from it.
Here is a question:
How much time and money would it take TATA or M&M to build a 4.2 liter V8 that puts out 420 hp as against Ford or BMW?
How much time and money would it take TATA to derive a V6 from the same engine block? How much would it take BMW who already have equivalent engines.
How much time and effort does it take TATA to set up a worldwide dealership of the size Jaguar/LR has as against the time it takes BMW or ford?
The answer to first question is not much, and 2, 3 do not make sense for BMW but do for TATA. This alone, IMO, is enough for TATA to put down 1.5 billion on those brands.
If TATA trying to make profit by reviving the brands, then this deal doesn't make sense. But if TATA is trying to buy technology that takes several years to build on their own, then this deal makes perfect sense.