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Originally Posted by iraghava  I completely agree with Steer here and for the following reasons:
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. Why do you think there are only "3" bidders worldwide for these "prestigious" brands?? There's got to be a good reason for that & there is.
Both the brands are in real bad shape & IMO it would take a company much more experienced in this business of developing & selling luxury automobiles than both TATA & M&M combined. Remember, selling commuter & economy vehicles is one thing & selling high-end stuff is another.
Remember, if BMW & Ford could not make these companies profitable & run them, there's got to be a good reason behind it.
Yes, but they have years & years of being in the Steel market. And what experience do they have of the auto market?? Absolutely none if you compare their 20-odd years of existence to the rest of the big manufacturers. Even Hyundai is over 40 years old internationally now & has only now started to find a foothold in the global market & even that mainly only in the Economy & VFM market.
IMO both our companies don't have the expertise or experience to go into the international luxury market at this point of time. In all probability they are going to burn their finger, nay their hands badly at this venture. |
Ishan, Sorry to disagree! BUT, Telco has experience of automobiles from the days when they were partners[1950's] with Mercedes Benz in India.
They also have the 'attitude' for a luxury car thats required!
The reason why LR and JAG are in a mess, is because they were neglected[Margarat Thatcher nationailised Jag], and the the total Staff were living on Past glory, which Ford couldnt spend time and energy to work on and change. Like Corus, the trick is in utilising the resourses to the fullest to reduce costs and offer the cars at a much more competitive price--and they would sell. Also remember what is $2 billion for the benefits that can be derived[the India Shining Factor], and theres always got to be the first time! one experiments.[Im buying some shares of Tata Motors for sure with a 4 year horizon] if at all their excercise fails, they will still be able to sell of the Assets 5 years down the line at a higher realisation.
The Indian govt. is backing them too. and there are no plans to buy the companies just to bring them to India. In 3 years the cost cutting measures will show. All IMO.