Globalization: Advantages of Jaguar Land Rover after Tata Acquisition

This essay examines the impact of globalization on Jaguar Land Rover (JLR) following its acquisition by Tata Motors Group. It highlights the advantages JLR gained through Tata's financial resources, enabling research and development of new car models and the production of cheaper cars for emerging markets like India and China. JLR leveraged Tata's resources to establish assembling branches in countries with favorable FDI policies, reducing costs for customers. Additionally, Tata's government relationships facilitated JLR's entry into markets like China. However, the essay also notes the potential disadvantages of relying on the parent company, particularly if Tata becomes unable to provide further financial support due to economic downturns. The essay concludes that globalization, while beneficial through acquisitions that aid struggling companies, can also be disadvantageous if the acquired company fails to thrive, leading to losses for the parent company. The essay references multiple sources to support its analysis of JLR's globalization strategies.

Running head: GLOBALIZATION 1
Globalization:
Name:
Institution:

GLOBALIZATION 2
Due to globalization, the business environment is changing rapidly. Considerably, there
has been the emergence of new business trends owing to the tremendous interaction between
companies over the last few decades. Thus, most businesses have opted to adopt these new
trends in order to survive in the competitive global market. Notably, the most common trend
witnessed as a result of globalization is the element of merger and acquisition (Hill, Hult,
Wickramasekera, Liesch & MacKenzie, 2017, pp. 30). Therefore, this essay explores the
advantages that Jaguar Land Rover was able to get after being acquired by Tata Motor Group.
The acquisition gave JLR Group an advantage to use the parent company Tata to
penetrate in the new markets and make profits (Mukherjee, 2016, pp. 48). The first way was to
use Tata’s financial resources in researching and developing new cars which are strong. Since
JLR was lacking new powerful car models appealing to all prospective customers, Tata parted
with $2 billion in research of new models of cars and also gave $12 billion to help the company
in producing new cheaper cars for new emerging markets in India and China. Secondly, JLR
Group utilized the opportunity to open new assembling branches in countries like Brazil where
the countries have a friendly FDI policy. This helps to reduce costs that the customers incurs
from taxes linked with car importations thus making the cars cheaper. Lastly, JLR Group used
Tata’s good relationship with governments in the emerging economies to help it penetrate into
the countries like China where they have opened their industries to manufacture and sell cheaper
cars in those countries (Mukherjee, 2016, pp. 48). However, leverage and reliance on the parent
country might turn to be a disadvantage since Tata might not be ready to inject more funds to
JLR Group since it continues to produce low profit percentages due to economic fall in emerging
economies like China.

GLOBALIZATION 3
In conclusion, globalization in business is good since it has come with some positive
elements like acquisition which has helped the struggling companies like JLR Group to turn
events and grow. However, acquisition can be disadvantageous since the acquired company
might fail to pick up thus resulting to a lot of losses to the parent company.

GLOBALIZATION 4
References
Hill, C., Hult, T., Wickramasekera, R., Liesch, P., & MacKenzie, K. (2017). Global Business
Today Asia-Pacific Perspective. McGraw-Hill Education, pp. 10-40.
Howson, P. (2017). Due diligence: The critical stage in mergers and acquisitions. Routledge, pp.
1-24.
Mukherjee, D. (2016). Case analysis: Tata Motors' acquisition of Jaguar Land Rover. The
Business & Management Review, 8(3), 48.