~ by Charmaine Mirza India Inc. is reeling in the wake of the recent dismissal of Cyrus Mistry’s dismissal as CEO of Tata Sons, the promoter company of the Tata Group. The subsequent fracas between Ratan Tata and Cyrus Mistry that has ensued has raised many questions (and eyebrows). But the question that Inchin Closer is asking is if this will have an impact on the Tata Group’s interests in China. If so, which way will the balance tilt?
- Cyrus Mistry was bullish on China as a market for future growth.
- But the fact remains that the initial roots for the Tata companies’ businesses in China were already sown prior to him taking over.
- There were also strategic alliances between the Tata Group and some provinces in China who foundations had already been laid under Ratan Tata’s stewardship.
Today, the Tata Group collectively has approximately 3,500 employees under its umbrella in China with TCS leading the way. As the largest company and cash cow of the Tata Group, TCS is the least likely to see fluctuation (in fact, the value of its shares may even rise with Ratan Tata’s return. While the change in leadership may cause a few ripples, it is unlikely that it will affect TCS’ collaboration with the Chinese government in the long run. Nike Darwin Goedkoop Tata Motors on the other hand, may have a rockier road to navigate. Tata’s other cash cow is Jaguar Land Rover, and China is its biggest market. Air Max 2015 Heren Goedkoop The 2015 downturn in the Chinese economy affected JLR’s profits, as did the Chinese government’s beady-eyed scrutiny of foreign luxury car manufacturers, some of who were marking up ancillaries and spare parts astronomically. However, Tata Motors has managed to offset this somewhat by manufacturing some of its models locally in China in its joint venture with Chery Motors. The joint venture effort should result in a 15% decrease in cost and therefore price. Mistry was personally involved in getting the entire Tata Motors engine back on track, and it wouldn’t make sense to make any immediate dramatic changes in a market that is not only so profitable for JLR, but has enormous potential for Tata Motors’ lagging passenger car segment. While China has proved to be Tata Steel’s nemesis globally, particularly in the UK, Tata Steel has its own China interests which were acquired as part of its acquisition of Singapore based NatSteel. If the leadership change has any impact on Tata Steel’s China businesses, it will more likely be as an indirect result of it propping up its UK and European steel operations. On the other hand, companies like Tata Global Beverages and Indian Hotels Co. Ltd.’s luck in China has been less successful. After laboring through the layers of intricacy that goes into developing hotels in China, all four of IHCL’s hotel projects in China have been scrapped under Cyrus Mistry’s reign, including its much coveted location within the Temple of Heaven park in Beijing. Therefore, while Tata may tread cautiously in any major new forays into China, chances are that it will remain steady with what’s working for the group at the moment. Nike AIR Max 2017 What is noteworthy, however, is that Chinese companies have increasingly become large suppliers to the Tata Group. Last year, Huawei secured a 15 million USD contract to overhaul Tata Teleservices’ wire line network – and this is where the crunch might come, as a bruised and embattled Tata Teleservices has become a tough bone of contention over the DoCoMo lawsuit – one which Mistry wanted to axe. Ratan Tata stepping in as an interim chairman will not have any immediate impact on Tata’s current operations in China. In fact, most Chinese business executives recognize the Tata name and hold it in high regard. Nike Air Max 95-360 Heren air max 2017 goedkoop For those who think that Ratan Tata doesn’t have an appetite for China, they only have to look back to April 2016 when he made a strategic investment in Xiaomi, the mobile hardware manufacturer – the first by any Indian. However, what remains to be seen is whether Mistry’s ultimate successor has a taste for China or not.