 "LR buyout was timely, says Ravi Kant")
With more than 85% of the consolidated net profit of Tata Motors now emerging from luxury brands Jaguar and Land Rover, Ravi Kant, the vice chiarman of the company said that the timely buy-out of the two brands is what helping the company stay afloat.
"Today Jaguar Land Rover account for more than 85% of the bottom line of Tata Motors so one shudders to think if JLR was not with us what would have happened to Tata Motors", said Kant at the Global CEO Conference.
Jaguar Land Rover returned with a net profit of 1.21 billion pounds for last financial year while Tata Motors stand-alone financials returned a net profit of just Rs 301 crore for the last fiscal.
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Lacklustre performance from both - commercial and passenger vehicles - for most most of last year resulted in a slump in financial performance of Tata Motors, India's largest automobile maker. Last year consolidated revenues of the company stood at Rs 192,419 crore while net profit stood at Rs 9,900 crore.
Meanwhile luxury car demand surge from China has pushed JLR to be the fastest growing luxury car maker in the world, beating the growths of BMW, Mercedes and Audi.
"There was tremendous brand values but always the question was whether we could combine. We came to the conclusion that Ford had done a number of things as a result of which there are some nice products in the pipeline and the company had the ability to sustain the introduction of new products", added Kant.
Among the new products that Tata Motors inherited from Ford was the Evoque compact luxury sports utility vehicle. The Evoque, launched in 2011, became amongst the best selling models in its class, still having a waiting period in most markets.
"We knew through the due diligence that when the good times comes it will become a very very green proposition so all that loss can be recovered in a short period of time", Kant said.
Kant who is the non executive director, joined Tata Motors in 1999 is due to retire next year in June when he becomes 70. He retired from all executive positions in 2009 when he was the managing director of the company.