[eq24]

Tata Motors suddenly came from no where and after acquiring JLR have created a name for them which many manufacturers can just dream of creating. Through the amazing acumen of Mr. Ratan Tata, he saw an opportunity in a dying brand and literally breathed a new life into this one ailing British marquee. And to reward Mr. Tata for his hard work, like a phoenix from the ashes JLR took the automotive world by storm, starting with the XF then the XJ, then the Evoque and now JLR sits pretty with its German counter parts even teaching them a thing or two how this business should be done. Sales are up in almost all operating markets and new products and technologies are slowly taking them from strength to strength.

But coming to India, home of the TATA's, a place proverbially speaking, where it all began, JLR is not showing any real urgency or even keenness to really succeed. You compare this with unknowns(with respect to a larger India) like Audi and to a lesser extent BMW which stormed India in 2003-04 and completely took the Indian market by surprise, even the Grand daddy Mercedes had trouble keeping up until lately, now that it is bouncing back.

One can only dream of having the kind of integration the TATA's have in India, infrastructure, man power, political support, they have it all and yet, results are at best meh!
And it is not like people do not like JLR products, if watching an Evoque does not make you drool, then God knows what does. The same can be said of the XF and the XJ as well.

Which brings me back to the core question on hand, WHY?

We see no aggressive marketing/product placement?
Aggressive pricing?
And why is it that last Friday when you could not find a single available SA in Audi Gurgaon, AMP motors, the JLR dealership, all the people there were the staff and no customers.

The same complacency is evident in how TATA motors handles its domestic operations but one would think with such a winner on their hands they would really wake the Heck up.

I however have a feeling and BOY I hope I am wrong in this, but is TATA hoping to portray JLR as a super premium brand in India?. And is that the reason they are content with over inflated MRP's and no real push.

Reality Check would be then that JLR is no Rolls or Bentley. It is an aspirational brand but not really that high on the food chain, I would wager that even Porsche is higher than JLR in the pecking order and most Indian's today are really well traveled and have a high level of exposure to what is really going on in the other parts of the world. Isn't this the reason why Volvo is not really rising in India. But I do not really care about Volvo here, no offence.

So what is it then? why is JLR not really that successful in India?

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[AyAn!]

Well, JLR seems to be doing brisk business outside India, which was never supposed to be their halo market to start with, so the lackluster performance in India should be the least of Tata Motors' worries at the moment. Priority wise, TML's pretty busy pulling their own act together in their home market now, and only after that grouse is smoothed out, maybe they'll start thinking getting aggressive with the JLR brand.

But I agree that JLR deserves more sales and one can easily see that happening if their bread and butter models like the 2.2 XF Diesel are marketed extremely aggressively. But for now, it's just textbook style, mediocre marketing, and the cars sell by their own virtue and desirability.

[avira_tk]

JLR has seen it sales growing the world over and India doesn't have the kind of numbers right now that would interest a company trying to get the numbers to secure its existence. The Germans already enjoy high sales the world over and India is a new frontier for them, JLR needs the developed markets' sales, although India is growing,the actual numbers are too small, fastest growing also means lowest base, China is probably the biggest market for JLR, they will focus on what gets them the money.

The new Jaguar compact saloon should help matters, but right now TML should focus on it's own existence in India, none of their cars are desirable, with the exception of the Safari perhaps. JLR cars have the exclusivity factor and the prices start way ahead of the Germans, naturally this will restrict sales with the state of the economy now, its only expected.

[absynthguzzler]

I'd like to think on the positive side of the whole TATA- JLR story.

Jaguar had lost its aspirational value whilst LR was still king of its domain. however, for a deal to be done for sale of Jaguar, LR had to be thrown in. The deal was sweetened and luckily for TATA , there were not many risk takers from the west because of the economic crash.

Post acquisition, It is not like there was any other value-adding knowledge transfer at this stage from TATA to JLR. Executing the concepts' that JLR had and converting them to road cars, thereby seeing a turn around globally was by itself, an amazing vision and feat by TATA. I often wonder, if TATA could gamble and predict this stability of the brand based on "upcoming models", how come the previous owner didn't.

I remember reading headlines every quarter that factories in UK are working at full capacity, more staff hired, plant expansions etc. This spelled doom for previous owners considering UK is not a cost effective country to manufacture goods from. ( The hourly wage is nearly double that of USA even if im correct).I would think that JLR is still recovering and stabilising itself at the operational level with such dynamic aspects.

I'm not too concerned that India hasn't been a sales target for JLR yet. Im just glad that an Indian Company has managed to take over the reins and effected a turn around. Tata's have infused management and financial know-how ( the Asian way )and ensuring that JLR remains sustainable. Very soon, the long term sustenance of the brand globally will not be questioned.

Im sure TATA would then be able to position and price their cars according to the domestic market.

[eq24]

Originally Posted by avira_tk

JLR has seen it sales growing the world over and India doesn't have the kind of numbers right now that would interest a company trying to get the numbers to secure its existence.

The new Jaguar compact saloon should help matters, but right now TML should focus on it's own existence in India, none of their cars are desirable, with the exception of the Safari perhaps. JLR cars have the exclusivity factor and the prices start way ahead of the Germans, naturally this will restrict sales with the state of the economy now, its only expected.

I agree and respectfully disagree with your statement, at this time they should really focus on the developed markets first, which they are doing, but it is the developing markets where the action really is. Lets not forget that a lot of JLR DNA is a Ford doing not TATA. It is all Fords design and synergies which TATA is reaping at the current time, but for a company to stay relevant it has to start developing its own game changing technologies to stay relevant in the larger picture.

I found out recently that a lot of JLR cars are going to be kitted with the Ecoboost engines as TATA has no expertise there, so would it not be a big negative not right now but say in two or three years time and what if Ford stops licencing its engines to JLR then won't they then be in a fix to find a suitable replacement. Now if something like that happens news like this will start filtering and it does not bode well for a premium car manufacturer to have engine sourcing troubles. If Suzuki and Fiat were to terminate its engine sharing agreement, it wont hurt Suzuki largely as the segment operated in are not too sensitive to such matters. But in the JLR segments this will hurt. At that time even if they start pushing in India, people in the know will still run towards the M B A brands to get their aspirations fulfilled and not be keen on JLR because of lack of engineering Prowess.

To sum up, JLR is currently the flavour of the month, to put it in a light way and they should use this positive momentum to take all markets by storm, waiting for other markets to mature and then coming to developing markets will be too little too late. JLR's biggest shortcoming is lack of relevant technology, they are nowhere compared to where Mercedes, BMW or Audi is today in regards to tech knno how and delivery. They might get there one day but these guys will be leagues ahead by then.

I really feel happy that an Indian manufacturer is somewhere today where most would not have even thought possible but as time passes on I fear this momentum will wane.

[vb-saan]

Originally Posted by eq24

Tata Motors suddenly came from no where and after acquiring JLR have created a name for them which many manufacturers can just dream of creating. Through the amazing acumen of Mr. Ratan Tata, he saw an opportunity in a dying brand and literally breathed a new life into this one ailing British marquee. And to reward Mr. Tata for his hard work, like a phoenix from the ashes JLR took the automotive world by storm, starting with the XF then the XJ, then the Evoque and now JLR sits pretty with its German counter parts even teaching them a thing or two how this business should be done. Sales are up in almost all operating markets and new products and technologies are slowly taking them from strength to strength.

The answer lies in quoted paragraph above. They are in the process of re-establishing themselves in the developed markets globally, and have been quite successful at it after the Tata motors takeover. In my opinion, they should continue to channelize their energy on that. And their upcoming products (like the 3-series rival from Jaguar) probably can provide the required penetration to our price sensitive market.

But on a related note, I would like to see Tata as a brand get some advantage with the technology they can access, and bring in some of the high standards (of the likes of JLR) into their home-grown models. For e.g.; Ford gathered a lot on safety tech during their association with Volvo. So far, I don’t see any such improvements on a Tata branded car.

[prakhar1998]

While JLR might not be very keen on India, I do see a much higher level of interest now. The new Range Rover for instance hit our markets very close to the world launch. Now, I see people preferring a jaguar over a BMW. They say that Jaguars are an upgrade over the usual Audis and Bimmers but I would like to disagree. JLR has very successfully maintained the image of a premium brand. But instances like Salman Khan's Range Rover keep he more car savvy one's more updated about the not so premium ASS of JLR. It's high time and JLR should buck up and better their ASS and better price the products. BTW the new Range Rover is 2 crores!. I would prefer buying the new S-class anyday over the Rangie, who would off-road in a 2 crore vehicle anyway?

[Sanjunair5]

The simple reason is market size and growth potential. Jag sells close to 100,000 cars in China, may be 75,000 each in UK and US. A realistic number that Jag can hope to sell in India is may be around 10,000. India is not as fertile for premium cars as these other markets are at the moment. So it is a no brainer where the companies focus would be. May be few years down the line the equations would change.

[amit]

Maybe the lesser aggressive marketing then German's is deliberate. Most of their car's are priced higher then the German's so it seems like they want to position themselves at a higher premium then the German's so they would prefer customer's to come to them rather then fight with competition for the customer's attention.

[deepzkonnected]

Originally Posted by eq24

So what is it then? why is JLR not really that successful in India?
[/b]

Well, its true that JLR is not firing all cylinders in India at the moment. Call it a part of their strategy maybe, however for a fact I know that the immediate focus for JLR is the Chinese Market including setting up a manufacturing plant there. Also read an article in ET couple of months ago which mentioned the C-X17 to compete against the German brands.

http://www.bloomberg.com/news/2013-0...challenge.html

This article also talks about their lack of an aggressive push in developed markets like the US and towards the end leaves us with a thought that things are changing for good at JLR.

But I had been to a shared service facility between TML and JLR in Worli in October, the kind of rush and the number of JLR cars that were present for service made me really think that the JLRs are definitely selling although maybe a bit above their own internal targets.

[9thsphinx]

As of today, I don't see JLR up with the ranks of BMW, Mercedes or Audi. In terms of brand recognition, I'd best rate it at par with Volvo, if we're talking about the Indian market.

JLR has an interesting portfolio including the suave Evoque and the hot XFR range. The problem as already mentioned earlier is how these products are marketed worldwide. The holy trinity (BMW, Mercedes and Audi) are very aggressive with their marketing whereas JLR is still catching up. JLR needs to establish themselves as a premium car maker abroad before they compete with the holy trinity in India and that's what Jaguar has been doing off late (post the Tata acquisition). The reason they're not interested in the Indian market is because they need to establish themselves and be recognized first in the international markets and only then would they be able to effectively market all that goodwill and repute to the Indian market. And that's one of the key reasons why the holy trinity succeeded in India!

As of now, and as long as, international buyers don't actively consider JLR in their buying decision, there's little value in concentrating efforts to increases sales in India. There's no doubt it will happen, considering how JLR is churning up very capable machines nowadays, but it'll only take some time.

[issigonis]

>>>

By the standards of the teutons, JLR is a (relatively) smaller operation, with limited reach in terms of new technology development etc. Their focus is to deepen their market in regions where they are perceived to be premium - China (where they are doing very well by sales numbers) & the Middle East (where LR is doing better as the RR of off roaders). And sustain & build interest in their new offerings in other developed markets.

JLR has plans for a 3 Series/ C Class rival to expand their offering bouquet, develop smaller 4 cylinder engines & hybrid vehicles and are also mulling a car assembly plant in Saudi Arabia, given the availability of bauxite/aluminium there.

India will get bigger on their radar when the nosediving Indian economy starts to climb up again and the initial momentum seen today (by way of potential buyers considering a Jaguar in their shopping basket along with the teutons) gives way to accelerating sales with potential buyers placing it as first choice. No doubt this will likely happen with some nifty brand positioning in the interregnum, to keep interest in the marque alive & growing, along with sales following that of the teutons.

The technological leap between JLR & Tata Motors is vast. The chasm between the brands is wider and care has to be exercised to ensure that potential JLR buyers are not turned off by the 'association'. Snooty? Yes, but that is what brands & branding is all about.

The objectives/strategies of the two organisations are very different, and so the selection of technologies & capabilities has to be done carefully. Tata Motors requires a good pipeline of VFM vehicles in the small hatchback to family sedan space, for its volume growth and to build upon its economies of scale. It also has to stabilise its production quality in India and its after market services, which has suffered partly due to bad word of mouth publicity.

In my view, once Tata Motors recovers ground in India, and this may take years, it should look to expanding production/assembly in broadly similar socio-economic geographies : Indonesia, Kazakhstan, Ukraine & Philippines come to mind. Eyecatching designs, contemporary techonologies, reliable performance & build quality plus VFM pricing taken together are tall challenges.
Hyundai has done it most recently, and is viewed as a reliable brand in the developed markets of the west, nearly twenty years after it started selling there. It had the backing of its government though.

Tata Motors might well draw inspiration from Hyundai's ascent.

Regards

[tatsago]

One opportunity both Tata and JLR seem to be ignoring is to bring the Defender back to its roots. In my opinion the Defender has slowly gone away from its original purpose of being a workhorse which is equally at home on the farm or a country manor due to rising manufacturing costs in the UK. If only the Tatas could get the defender costs down it still has the capability to become a strong contender.