Jeff Reinke, Editorial Director, IMPO
One of my favorite all-time movies is Steve McQueen’s Bullitt. It’s not that the movie itself is all that special, but anyone familiar with it knows exactly why it’s among my top picks. It contains a scene that is considered to have revolutionized the way Hollywood filmed car chases. So if you enjoy late 60’s muscle and haven’t seen the movie, do yourself a favor and either rent it or YouTube it for a look at Frank Bullitt’s Highland Green 1968 390 Fastback Mustang in pursuit of the bad guys in a Tuxedo Black 440 Magnum Charger (my favorite of the two cars) from the same year.
Now, even though I appreciate the punch-in-the-face lines and underhood rumble of these vintage vehicles, I don’t really qualify as a “car guy”. As long as there’s a little style, it’s safe and gets decent gas mileage, I’m not a zealous critic of automotive design. I think vehicles like the Tesla and Scorpion are amazing, and am equally intrigued by the XP project, as well as other developments like Audi’s turbo diesel initiatives, but those are more about performance and technology than getting over-heated about the vehicle itself.
It’s about weighing function and economics when it comes to my own vehicle of choice. At the end of the day if I can get from point A to B in a comfortable manner then I’m pretty happy with my Chevy Impala. I appreciate those offerings with added features and functions, as well as the raw power of yesterday’s muscle cars, but to me a car is a commodity. I don’t think I’m alone here either, and a recent release about some polarizing brands in the automotive sector seems to reinforce that notion, and offer perspective on design innovation versus legacy brand power.
Based in Mumbai, India, Tata Motors has made headlines over the last 18 months for primarily two reasons. The first was the unveiling of their Nano vehicle. Positioned as a way to help those in India afford an automobile, the 2-cylinder 4-passenger vehicle retails for less than $3,000. Then, in an interesting move late last year, the company purchased the Jaguar and Land Rover brands from Ford.
A release from earlier this week indicated that while sales for the company within India have been strong, the $3 billion loan Tata needed for the acquisition is starting to affect overall profitability. Basically, for their fiscal year that ended in March, the company lost over $500 million, as opposed to a $450 million profit the year prior.
Even before the Nano, Tata had a domestic niche in their home market that allowed them to operate at a very healthy margin. Then they brought in two brands that, while held in very high esteem, are seeing their overall marketplace interest dwindle. Reasons for the waning interest varies from competitive factors to price to fuel efficiency to the fact that service is more complicated. We look at a new Jag rolling down the street and admire what it can do, but how many people are able to purchase one in the current economic climate or willing to endure the added obstacles when an equivalently- priced Mercedes or BMW with the same capabilities offer fewer logistical issues?
I think there will always be a place for products like a Jaguar or Land Rover, and even the highly inefficient muscle cars I still love, but in today’s age of shorter product lifespans, fickle customer demands, tighter pocketbooks, and buyers who want greater levels of customized solutions, there can be only one reason why Tata would look at complicating their offerings with these two brands — notoriety.
They probably got a great deal as Ford looked to infuse the company with some much needed cash flow, and the acquisition might have put a legitimate face on Tata in some circles as they look to expand their global offerings, but this zeal for look-at-me attention could be their downfall. The purchase seems to reek of a focus on what it could do for the company instead of the value it provided the customer. Now Tata is learning that regardless of how much fat they trim from these legacy brands, it won’t change the face of competitive influences or customer desires. Here lies the lesson learned.
The gospel of global competitiveness preaches innovation as its guiding light, not clinging to the ideas of a failing legacy. I guess that’s why I found this report so disheartening. I wish Tata would have realized the same thing . The way forward is not about trying to bring back fallen legends, but listening to current-day demands and answering them with new solutions.
What's your take? Let me know at firstname.lastname@example.org.