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VW AG and TATA Motors formed an alliance to develop new products

It seems the highly successful Renault-Nissan Alliance has led to more partnerships between carmakers. Volkswagen and TATA Motors have reportedly inked a longtime partnership deal on Wednesday. The two companies have allegedly signed a Mou or Memorandum of Understanding towards the development of new technologies, products and platforms. According to Autocar India, it has been more than a year since the manufacturers have been talking about the agreement.

The German automaker has been eyeing the Indian manufacturer as potential partner in exploring new markets. Being the largest vehicle firm in India, Tata Motors is also looking to increase its sales margin within or outside its market range. Nevertheless, this new partnership will help Tata come out with more vehicle lineups by 2019. It should be noted though that Jaguar, Land Rover and TAMO (TATA’s sub-brands) are not part of the alliance.

TATA’s latest AMP (or Advanced Modular Platform) is probably the most feasible architecture for the new collaboration. After the AMP received the EDAG approval, Volkswagen has found a more affordable alternative to its existing MQB-A platform. The AMP offers flexible architecture as well as definite cost advantage. At the very least, this will allow them to produce more extensive model range.

Read the entire article VW AG and TATA Motors formed an alliance to develop new products

Tata Motors’ net income in 1st Quarter of 2015 falls 56% to $269 million

Tata Motors' profit in the quarter that ended March declined amid the decreasing demand in China for Jaguar Land Rover vehicles. In the latest quarter, Tata Motors’ net income decreased by 56% to 17.2 billion rupees ($269 million), from 39.2 billion rupees the previous year. In a statement last Tuesday, Tata Motors said that profit at the Jaguar Land Rover unit decreased by 33% to 302 million pounds ($465 million).

When compared to the same quarter last year, the retail sales volume of Jaguar Land Rover in the past quarter fell as it was driven down by a decrease in demand for luxury vehicles in China. Another factor that adversely affected Tata Motors' earnings was a persistent slump in sales of its light commercial vehicles in its home market India.

In the quarter, the revenue of Tata Motors climbed by 3.5% to 675.8 billion rupees. Meanwhile, Jaguar Land Rover sales rose by 8.9% to 5.83 billion pounds. Tata Motors’ statement further reveals that the profit of JLR before tax declined by 31% due to higher depreciation and amortization, as well as "unfavorable revaluation of foreign currency debt and unrealized hedges that are not eligible for hedge accounting treatment."

Read the entire article Tata Motors’ net income in 1st Quarter of 2015 falls 56% to $269 million

Tata Motors eyes up to $1.2 billion in rights offer

Tata Motors Ltd. is planning to generate up to INR75 billion ($1.2 billion) in a rights offer to increase its capital. In an exchange filing, Tata said that it is offering six shares for every 109 held at INR450 each, representing a 15-percent discount to the closing price Tuesday last week. Those who hold so-called differential voting rights will be offered stock in the same proportion at INR271 each.

According to Tata, it would invest around INR40 billion annually at its Indian operations in the next two to three years, and up to GBP3.7 billion ($5.5 billion) annually over the same period at Jaguar Land Rover on product development and expansion.

Piyush Jain, an analyst at Morningstar Investment Adviser (India) Pvt., wrote in a note that Tata priced the share issue “conservatively,” saying that the higher dilution relative to expectations is not materially significant to cause any change in their fair value estimate of INR700 per share.

Read the entire article Tata Motors eyes up to $1.2 billion in rights offer

Tata Motors planning two premium SUVs loaded with Jaguar Land Rover technology

Ok, we have to admit that we saw this coming! According to the latest reports from a Delhi-based newspaper, Tata Motors is working on two new upscale SUVs that will use technology developed by Jaguar Land Rover. Set to arrive in 2017, the five- and the seven-seater SUVs will be sold not only in India, but also in Gulf Cooperation Council countries and South-East Asia.

The company aims to sell 80,000 SUVs and the vehicles will be a fresh addition in the lineup after the Aria crossover proved to be a failure. Tata Motors sold only 376 units of the Aria last year, while a year before 927 units left the dealerships.

Codenamed Q501 (five-seater SUV) and Q502 (seven-seater SUV), the vehicles are part of a long product pipeline till 2020. Still, the vehicles will be an interesting addition taking in consideration that both will be positioned as premium cars with a price range of $20,000 to $31,000.

Read the entire article Tata Motors planning two premium SUVs loaded with Jaguar Land Rover technology

Tata Motors tripled its net income for the first quarter ended June 30, 2014 to INR54 billion ($882 million) thanks to increasing sales at its Jaguar Land Rover unit. Jaguar Land Rover particularly boosted its pre-tax profit by more than double from GBP415 million to GBP924 million ($1.6 billion).

Earnings at Jaguar Land Rover were helped by increasing demand for the Jaguar F-Type convertible and Range Rover SUVs. The carmaker saw its deliveries in the quarter ended June 30, 2014 jump 22 percent to 115,596 vehicles.

Better business at Jaguar Land Rover is helping Tata Motors remain afloat, as the company continues to grapple to make profitable its Indian operations that sells Tata-brand cars, buses and trucks.

Read the entire article Tata Motors triples Q1 net income thanks to strong Jaguar Land Rover earnings

Tesla Motors Inc. has appointed the seventh member of its board of directors in the persona of Robyn Denholm. Denholm, who is Juniper Networks Inc.'s executive vice president and chief financial and operations officer, will join Tesla's board on Aug. 11, 2014, thereby becoming its first female director. She will be tasked to head Tesla's audit committee.

She will be a member of the compensation committee and the nominating and corporate governance committee. According to Tesla, Denholm will be taking over board functions once held by Brad Buss, who is giving them up after he was tapped as chief financial officer of SolarCity Corp.

Buss will still be a member of the board. Other board members include Chief executive and chairman Elon Musk; Antonio Gracias; Kimbal Musk; Ira Ehrenpreis; and Steve Jurvetson.

Read the entire article Tesla Motors names Robyn Denholm as 7th board member

For the next six years, Tata Motors will release a lineup of vehicles that it intends to offer globally, company MD Karl Slym said. Even if Tata Motors has gotten more success with its commercial vehicles, Tata aims to form a family of world-class passenger cars, which will all be based on the Advanced Modular Platform (a new, flexible, Volkswagen Group-style architecture).

Tata Motors aims to prioritize the replacement of the existing road car lineup, which includes the Indica hatch (the model that became the City Rover in 2003). Tata’s lineup struggled in India during the recent sharp downturn in the country. The Australian media reported that the new platform will surpass the achievements of the Volkswagen Group.

When interviewed by the Sydney Morning Herald, Dr Tim Leverton, Tata Motors’ head of research and development, said that VW had to go through “six or seven generations” of products to get to its present status but that Tata would “go directly to a very interesting solution.” He said that the AMP will be flexible in length as well as in width.

Read the entire article Tata Motors plans an Advanced Modular Platform for global expansion

As sales of Jaguar Land Rover unit grew quickly, Tata Motors was able to raise its income in the second quarter by 71% to 35.4 billion rupees ($564 million). Tata Motors said that the profit of Jaguar Land Rover increased by 66% to 507 million pounds ($815 million) in this quarter. The strong demand for Jaguar models, such as the F-Type convertible that started deliveries in May, drove up retail sales to increase at its quickest pace in four quarters.

Tata Motors started selling the latest Range Rover Sport in several markets like the U.K. and China and intends to introduce the model in more markets. Mahantesh Sabarad, an analyst at Fortune Financial Services India Ltd. in Mumbai, said that JLR is “driving more than 100% of the profit” while the parent is incurring losses.

He said that the growth rate is expected to become moderate to around 12% to 14% in the next two years. Jaguar Land Rover, which Tata Motors acquired from Ford Motor Co. in 2008, made up 88% of Tata Motors' operating profit in the year that ended March. Tata Motors, which is included in the $100 billion Tata conglomerate, has become reliant on its U.K. unit to support profits.

Read the entire article Tata Motors income in the 2nd quarter increased by 71% thanks to Jaguar, Land Rover

The image of Tata Motors’ Nano car as a cheap car that’s an alternative to a motor scooter didn’t actually do much good. That’s why Tata Motors is expected to launch more expensive models that are based on the Nano, the compact car launched in 2008 that only cost $2,000. It’s true that the Nano caught the world’s attention but the market in India didn’t quite match that enthusiasm with sales.

Since deliveries started in July 2009, only 229,157 Nanos have been sold. Sales in March 2013 were 86% lower than in the previous year. According to Tata Managing Director Karl Slym, the Nano won’t be discontinued but instead, it will get improvements meant to revive the model and for its prices to be nearer to those of its competitors.

Slym said that the Nano's marketing "didn't gel with anybody." Those who drove scooters weren’t drawn in since they didn’t see Nano as a real car but as something that’s between a bike and a car. It also didn’t appeal to car owners since it was marketed as a two-wheeler replacement.

Read the entire article Tata Motors expected to launch more expensive versions of the Nano

Jaguar Land Rover may be headed for trouble as it faces declining margins and increasing capital expenditure. JLR’s cash pile is being eaten into due to increasing investment. This increases the likelihood of fresh borrowing, as declining profitability saw parent Tata Motors Ltd report its first decline in profits in five quarters. In the past financial year, JLR made up about 90% of Tata Motors' net profit.

This means that investors are more closely monitoring the UK unit's margins compared to those at Tata's domestic business. Tata has made use of JLR’s cash flows to resolve the debt that was incurred due to the purchase of JLR from Ford Motor Co. in 2008 for $2.3 billion. Because of the heavier dependence on lower-margin models like the Land Rover Evoque and Freelander as well as the unfavourable currency movements, JLR's profit margin decreased. Furthermore, free cash flow (FCF) at the unit became negative only months after it paid its weaker parent a maiden dividend.

JLR said that negative cash flow will continue in the next financial year as the carmaker begins 2.75 billion pound ($4.3 billion) a year investment program on its plants and product pipeline. The net profit of Tata for the third quarter had much lower market estimates at 16.28 billion rupees ($303 million), a 52% drop year-on-year and the first drop since the quarter to September 2011. Thomson Reuters Starmine said that analysts had expected average profit of 28.9 billion rupees.

Read the entire article Tata Motors sees profit fall as Jaguar Land Rover may be headed for trouble

Tata Motors denies that it is considering a plan to construct an auto assembly plant in Romania. According to the dailybusiness.ro Web site, the company is planning to invest 1 billion euros to open a production plant to build cars, buses, trucks and commercial vehicles. When asked by Automotive News Europe, a Tata Motors spokesman said there’s no plan like that being considered.

Tata was able to get a foothold in 2008 in Europe when it acquired Jaguar and Land Rover from Ford Motor Co. for $2.3 billion. The core Tata brand’s presence in the region is small.

It sells only a few thousand units each year. Tata presently sells the Vista hatchback and the Aria crossover in Italy and Spain. Since the Nano was launched in India in 2009, Tata had thought about offering the minicar in Europe.

Read the entire article Tata Motors denies reports about a possible plant in Romania

Tata Motors is thinking about offering a version of its Nano for the U.S. market, according to reports. It seems that Tata is considering such a project due to the success of the Fiat 500 and the Chevy Spark. Back in 2009 when the Tata Nano made its debut as the cheapest car available, it got a lot of attention. However, it wasn’t successful when it came to sales.

According to the Indian Express, Tata sold only 74,527 units in Fiscal Year 2011, which is decent but it failed to reach the initial targets. Another obstacle that the Tata Nano faced was in 2009 and 2010 when there were reported cases of electrical/exhaust fires. The company said that these problems had already been repaired. The Tata Nano faces several challenges before it can get the go signal to be available in the U.S.

First of all, it doesn’t have airbags or two wing mirrors. It also doesn’t have any traction or stability control or power steering. It is powered by a 624-cc two-cylinder Bosch engine that has an output of just 37hp. If a Tata Nano does arrive in the U.S., it would likely be a production car based on the 2009 Nano Europa concept, which is powered by a three-cylinder engine partnered to an automatic transmission.

Read the entire article Rumor: Tata planning a bigger version of its Nano for the United States market

Tata Motors is considering a plan to open a factory in Saudi Arabia to build Jaguar Land Rover vehicles, chairman Ratan Tata said to Autocar India. He said that this plant would be positioned beside a new aluminum smelter. He added that this smelter will mean that the production of aluminum in Saudi Arabia would be highly competitive.

He explained that the company is looking into a business case of this assembly plant beside a large press shop in the long-term, especially with its focus on using aluminium in its products. Saudi Arabian Mining Co. (Maaden) and Alcoa have entered a joint venture to build this smelter, which is likely to begin production in 2013.

For many decades, Saudi Arabia (the top oil exporter in the world and the largest economy in the Middle East) has been hoping to make use of its bountiful natural resources to diversify its economy into complex industries. The electricity prices in the Saudi Arabian industry are affordable because of low natural gas prices. The conservative Islamic kingdom currently doesn’t have an auto industry yet to speak of.

Read the entire article Tata Motors planning to build Jaguar, Land Rover vehicles in Saudi Arabia

As the demand for luxury cars declined, so did the profit of Tata Motors (which owns Jaguar Land Rover). In fact, it didn’t meet analysts’ estimates. In the quarter ended June 30, Tata Motors’ net income increased by 12% to 22.45 billion rupees ($407 million). In a statement last Thursday, the Mumbai-based company said that it failed to meet the 27.3 billion rupee median of 35 analyst estimates that Bloomberg put together.

Jaguar Land Rover reported a profit of 236 million pounds ($369 million), which is 22% below the median estimate. These results may lead to concern that demand for Jaguar vehicles is declining as Europe's sovereign-debt crisis is ongoing and China’s economy slows down.

Jaguar Land Rover’s sales increased by 34% to 83,452 vehicles in the last quarter. From this figure, Jaguar sold 11,774 of its vehicles while Land Rover accounted for 71,678 units. Sales in the first quarter climbed by 48%.

Read the entire article Tata Motors shares fall as it fails to meet analysts’ estimates

The net profit of Tata Motors for the fiscal fourth quarter more than doubled as the high demand for its Jaguar Land Rover vehicles fail to make up for its poor performance at its core domestic business.

Tata Motors, which is part of the software-to-steel Tata Group conglomerate, said that the consolidated net profit for the quarter ended March was INR62.5 billion ($1.13 billion) compared to INR26.23 billion from the same period the previous year.

According to Tata, Jaguar Land Rover posted a net profit of GBP696 million ($1.09 billion) for the comparable period. Tata Motors had a consolidated net profit of INR62.3 billion, after accounting for minority interest and share of associates. Its consolidated revenue increased by 44 percent to INR506.09 billion, compared with INR351.48 billion the previous year.

Read the entire article Tata Motors’ quarterly profit more than double thanks to Jaguar and Land Rover

Italian car maker Fiat SpA and Indian car manufacturer Tata Motors have called it quits and have terminated a six year-old dealership agreement between the two automakers. The agreement had permitted Fiat to sell its vehicles in India through Tata dealerships. Analysts at IHS Automotive and Cyrrus AS, however, said the deal’s end could prompt Fiat to move for stronger ties with Suzuki Motor.

Fiat and Suzuki have collaborated for almost ten years, and stronger ties between the two could help the Indian carmaker reinforce its presence in India, as the Japanese company accounts for around 42 percent of auto sales in India. The Asia Pacific region, excluding Japan, accounted for around 60 percent of Suzuki’s 2.56 million vehicle sales for the year ended March 31, 2012. 

The Japanese carmaker has dealers across Asia and it operates nine factories in eight countries in the continent. In return, Suzuki could take advantage of Fiat's diesel engines and network of dealers in other large markets like Brazil. Deepesh Rathore, IHS Automotive’s managing director in India, said an alliance between Fiat and Suzuki would be a win-win for both companies, adding that the possibilities are endless.

Read the entire article Fiat ends dealership agreement with Tata Motors! Is Suzuki the new partner?

Sales of Tata Motors' commercial vehicles unit were flat in April even if the parent brand had poor sales. It’s because the slump had been offset by the high demand for Jaguar Land Rover vehicles. Tata Motors, a member of the Tata Group conglomerate, was able to sell 87,377 vehicles in April. Its overall passenger-cars sales increased by 7% to 49,369 compared with the previous year. Commercial vehicle sales fell 8% to 38,008 units.

Jaguar Land Rover sales increased by 29% to 25,143 last month. Jaguar sold 17% more vehicles to reach 3,603 units while sales at Land Rover rose by 32% to 21,540. The sales increase experienced by Land Rover was helped by the rising demand for the Range Rover Evoque premium compact SUV.

Since the launch of the Evoque SUV in September 2011, JLR has sold over 60,000 Evoques around the world. Tata, which purchased the two British brands from Ford in 2008 for $2.5 billion, is planning to invest $12 billion in JLR in over five years to get a larger share of the premium car market that’s dominated by BMW, Audi and Mercedes-Benz.

Read the entire article Strong demand for Jaguar Land Rover vehicles helps Tata Motors remain flat in April

Fiat could no longer use Tata Motors’ distribution network in India after they ended their distribution pact. In a joint statement, they said that a separate Fiat-owned company will now handle the distribution activities. Last February, Tata’s CFO C.R. Ramakrishnan said that its joint venture with Fiat wasn’t meeting the anticipated financial results or sales.

Since 2006, Tata Motors had been running the distribution of Fiat-branded vehicles in India with the use of 178 joint Tata-Fiat dealerships. Its dealers spread out in 129 cities will be urged to be a part of the foundation of Fiat's future network. In addition, the joint venture of Fiat and Tata includes the joint production of cars, engines and transmissions in Ranjangaon in the State of Maharashra.

Fiat had been assembling the Punto subcompact and Linea compact models at the plant since 2008. In the statement, it was also clarified that the production joint venture will continue to supply cars and powertrains to both Fiat and Tata.

Read the entire article Fiat will set up its own car dealer network in India, ends deal with Tata Motors

The chief financial officer of Tata Motors wants to double the investments in its Jaguar Land Rover brands to 1.5 billion pounds ($2.4 billion, 1.8 billion euros) annually to be used for the launch of new products and variants. CR Ramakrishnan said that Tata Motors has chosen its joint venture partner for the China production of Jaguar Land Rover cars.

The India-based automaker is waiting for the approval of the Chinese government to begin making luxury cars in the country. Ramakrishnan said that the company will reveal the identity this joint venture “very soon.”

In early February, Bloomberg reported that Tata Motors will partner with Chery Automobile. In the quarter that ends December, Tata Motors reported a 40.5 percent increase in profits as high sales of its JLR models offset the slow performance from its domestic arm as it was affected by the high costs and interest rates in India.

Read the entire article Tata Motors aims to double investments in its Jaguar Land Rover brands

Tata Motors launched its first hybrid ever at the New Delhi Auto Expo, demonstrating that like other automakers around the world, it has followed the trend to produce fuel-efficient cars. This hybrid is based on the current Indigo Manza but it was redesigned to preview how the next generation sedan will appear. Tata Motors has yet to elaborate on what its technical specifications are but what’s sure is that the Manza Hybrid is equipped with a 1.0 diesel engine supported by a 45 kilowatt electric motor. It features high-capacity lithium ion batteries – a technology that Tata has already been using in its electric concept cars.

Tata exerted a lot of effort for the Manza Hybrid to be as efficient as possible. The package features roof-mounted solar panels, a regenerative braking system, and start/stop technology. However, the concept is still purely hypothetical. Tata has yet to confirm if the Manza Hybrid will enter production. At the New Delhi show, there were other alternative energy vehicles such as a CNG-powered Tata Nano, a hybrid bus from Volvo, and the Dacia Logan-based Mahindra Verito EV.

This year’s Auto Expo has green as one of its themes but there are some in India’s auto industry that doubt how feasible marketing green cars would be in the nation. Kou Kimura, chief executive and managing director of Nissan -Renault India, said that India is “very far away from using this sort of technology.” Kimura added that due to the high cost, it requires government support in building the necessary infrastructure. However, there were some officials in the Nissan group that were “positively pessimistic” about the hybrid cars’ future in India.

Read the entire article Tata Manza Hybrid Concept unveiled at the 2012 New Delhi Auto Expo