On March 26, Tata Motors announced its agreement with the Ford Motor Company for the purchase of Jaguar Land Rover (JLR), comprising brands, plants and intellectual property rights.

The acquisition of the JLR brands and businesses gives Tata Motors an opportunity to enter the premium car and SUV segments globally, and enables it to build a comprehensive product portfolio. With the soon-to-belaunched $2,500 Nano at one end of the spectrum, and the recently launched Jaguar XF with a base price of $68,000 at the premium end, Tata Motors is aiming for a sizeable share of roads across the globe.

For Ford, the sell-off is part of its strategy of concentrating on the Ford brand globally. The deal relieves the company of a Jaguar that had been a steady moneyloser – and a luxury the company DEAL-OF-THE-MONTH AUTOMOBILES could no longer afford, as the profi tability and market share of its core automotive business continued to shrivel.

The transfer of ownership to Tata Motors is expected to close by the end of June. The total amount to be paid in cash by Tata Motors for JLR upon closing will be approximately $2.3 billion. At closing, Ford will then contribute up to approximately $600 million to the JLR pension plans.