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March 5, 2019

Is Tata Looking to Offload Jaguar and Land Rover?

Jaguar Land Rover’s not having an easy time of late. After handing its parent company the biggest loss in Indian corporate history, Tata is exploring all options for Jaguar Land Rover including a potential stake sale in the struggling luxury carmaker.

A report published by Bloomberg says that Tata is looking at all possible alternatives from selling a minority stake to finding a venture partner that’ll jointly develop vehicles and lower costs. However, as the company is reluctant to give up any control in JLR, it may seek fresh equity from investors such as a strategic partner.

Though JLR was Tata’s crown jewel, it’s become a burden of late due to slumping sales in China, the shift away from diesel engines, and supply concerns due to Brexit.

In China, particularly, JLR is dealing with a problematic distribution network and also overestimated the price they could charge for cars made there. They also found competing in segments occupied by more powerful players, such as BMW and Mercedes-Benz to be extremely difficult.

Source: Bloomberg

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