Ratan Tata took a sweet revenge on Ford

TATA group is a leading business house in India. Apart from scale of business operations, they are also known for values observed in their business practices.

Ratan Tata is another man, who continued the legacy of India’s most trusted business. When someone is insulted, anger is the only outcome. However, great people can use this anger to plan business policies and goals.

Back to 1998, Tata Motors under his chairmanship came up with TATA INDICA, passenger car industry in India. Tata Motors was a truck making company back then and they had to go through many difficulties due to their inexperience in passenger car industry. Finally, TATA INDICA was launched in 1998.

But, the result was an utter failure.Some people advised chairman Ratan Tata to sell the passenger car division following the poor response. He had no other option other than selling the whole passenger car business. Ford, showed interest in buying the whole passenger car division. Ratan Tata, along with his team flew to Ford Headquarters in Detroit to discuss the deal.

“We were called to Detroit for discussions and I accompanied the chairman. For nearly three hours, we discussed the sell-off with Ford officials but were meted out humiliating treatment,” said Kadle, who played a major role in the turnaround and growth of Tata Motors.

One official even asked him, “You do not know anything, why did you start the passenger car division at all?”

Tata had felt deeply embarrassed. Without finalizing the deal, he returned to India. Don’t know what he had in his mind at that time, but the meeting was sure something that changed the fate of Tata Indica.

Tata Motors re-engineered Tata-Indica based on customer feedback. Marketing was innovative with tag lines like “The Big… Small Car” and “More car per car” and it turned out that within a couple of years, it emerged as the largest-selling car in its segment.
In 2008, nine years after the meeting, which was on the verge of bankruptcy after the 2008 global financial meltdown -by taking over the iconic Jaguar Land-Rover brands for USD 2.3 billion. Ratan Tata came to their rescue by offering to acquire the brands for 2.3 billion dollars which amounted to 9300 crore INR at that time.

Bill Ford, along with his team, reached “Bombay House” which is the headquarters of Tata Group. The deal was finalized and Jaguar-Land Rover was acquired by Tata Motors.

In the meeting, Bill Ford, the chairman of Ford said to Ratan Tata, ” You are doing a big favor for us by buying Jaguar- Land Rover”. It was an understandably perfect moment for Tata and Bombay-House was filled with an air of sweet revenge.

Source: Tata Motors – Ford deal

Leave a Reply