Tata to treble expense in JLR R&D Swaraj Baggonkar / Mumbai February 14, 2011, 0:58 IST  After having managed to have Jaguar and Land Rover, the premium but money-losing brands, turn the corner and make a profit within three years after it bought these, Tata Motors has planned a massive step-up of investments in these.  Tata, India’s biggest vehicle maker, will spend about £1 billion (Rs 7,300 crore) on JLR towards research and product development (R&D) expenses this year. This is about 10-11 per cent of the two brands’ annual revenue. R&D expenditure is shortly expected to reach an annual £1.2 bn (Rs 8,800 crore) per year.   Click here to visit SME Buzz              Also Read            Related Stories               News Now      -    Tata Motors rallies 5% on robust Q3 nos -    Tata Motors ADR surges on Friday -    Auto sector growth could slow to 14-15% in 2011 -    Tata Motors net rises 3 1/2 times -    Shifting gears -    Tata Motors Q3 net soars four fold at Rs 2,420 cr Ford Motor Company, the US-based erstwhile owners of JLR, were pumping in only a third of that or £400 million (Rs 3,200 crore, exchange rate of 2008) into the two brands towards R&D, before they were sold to Tata Motors for Rs 10,200 crore in early 2008.  Added Chief Financial Officer, Tata Motors, C Ramakrishnan: “It’s possible that expenditure towards research and product development may trend upwards in a few years as new programmes and new projects start off.” Adding: “I would expect that about 10-11 per cent is reinvested in product and technology development now and moving forward, this would have an upward bias. The two brands generate about £10 bn now in a year.”  At least four new products under the Jaguar brand are under development, including a small sports car, station wagon, entry level sedan and a crossover. In addition, engineers are working on a concept called C-X75, an electric sedan to return 900 km to a charge, with a top speed of 320 km/hr.  Land Rover, a sports utility vehicle brand, is developing models that would hit the market this year and in 2012-13. These include improvement in the current line-up, as well as addition of the hybrid alternative. Jaguar will also make extensive use of the hybrid technology being developed in-house by the two brands.

DEEPAK KUMAR
PGDM 2ND SEM

IIMT