MUMBAI/LONDON–Indian automobile giant Tata Motors Ltd shows its presence at international level by acquiring the British luxury car units,Jaguar and Land Rover from the US carmaker Ford.Tata has to pay $2.3 billion for the purchase of these luxury brands,where as Ford has to pay $600 million to the pension fund of Jaguar-Land Rover.

Tata has been discussing with Ford since it leads the race to buy Jaguar and Land Rover.The sale was confirmed by Tony Woodley,joint leader of Unite,the largest trade union of Britain, which had backed the Indian automobile giant in its bid.

“Tata views this deal in positive terms as it is able to make an international presence, instead of being a company which focuses only on its home market,”said Mohit Arora,the managing director for India at J.D. Power Asia-Pacific.Ford sold these luxury units for less than half the price that it had paid to acquire them. Ford bought Jaguar and Land Rover for $2.5 billion and $2.7 billion in 1989 and in 2000 respectively.As the US auto major had met with loss of $12.6 billion in 2006 and $2.7 billion in 2007, it has decided to sell off its Jaguar and Land Rover units to focus on its main brands.

“We’re pleased that Tata made long-term supply agreements for the Jaguar-Land Rover components, especially the engines from Bridgend and Dagenham, said Tony Woodley”.

“Jaguar and Land Rover are extraordinary brands,” said Alan Mulally, the CEO of Ford in a statement. “We are certain that they are going to flourish under Tata Motors,” he added.

Tata said it doesn’t expect any major changes to the work force at Jaguar and Land Rover units.The company has agreed to maintain the British work force around the current 15,300.Tata announced that the transfer of the brands would take place the end of the second quarter.

Tata should introduce adequate capital to rescue the brands from facing losses and to develop new products to better compete with other luxury carmakers such as AUDI, BMW,etc said Erich Merkle,vice president of IRN Inc.

“Now, the time has arrived for Ford to concentrate on the world wide integration of Ford brands, as we are going to implement our strategy to create a strong Ford Motor Company that yields profitable growth for all,” said Alan Mulally, the CEO of Ford.

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