Tatas has churned out its plan to make a reverse turn with Jaguar and Land Rover. As a result, one of the two West Midland plants will see the shut down in 2014, with the company going for expanding the product range and reducing the costs. Right from its purchase of these two brands from the British firm, Tatas has not been able to safe them in a profitable manner with the annual combine sales dipping to 32% to 1.67 lakh units. Of the two, Jaguar yielded a loss to the tune of Rs1777 crore to Tatas aggregating the net loss of Rs2505 crore last fiscal. Hence the company had a tough time squeezing the mind by burning the midnight candle in consultation with KPMG and Roland Berger.
According to the company sources, the new initiative will go in terms with the business environment seen in the industry. In such a move, the company would roll out as many models needed for the company’s growth in the coming years. For this all the worksource and manpower will be mobilized to the single unit. The proposal would be chalked out in the first half of 2010 to be implemented in the next decade. In the meantime the company will effect replacements of the existing sedans, SUVs, and additional models along with powertrain variants. For producing Range Rover model, there will be 800 new jobs to be pressed into service and the ensuing delivery of LRX Concept, one among the Rover ranges, will pose to be the smallest and most fuel efficient. Most significant aspect of Tatas’ motif is the cost coasting including sourcing of parts from low priced segments like India; this move includes pension restructuring, lower employment cost for the new recruits and simplified business strategy.
The CEO of JLR expressed the hope that these two great brands would yield desired result to the company subsequent to the efficiency, competitive nature and future investment. The move is a further effect of the ones initiated last year, whereby the production was reduced by more than one lakh units, lay off for 2500 staff and reduced budget in spending.