Creating a New Brand is Risky

India and specifically Tata have found in recent years just how difficult it is to run a car company – or race team, with several struggling financially or not able to get product to market. Recently Force India changed hands, the Formula 1 team was put into administration in August by the High Court in London. At the time I suspected that Lance Stroll, a junior F1 driver would be involved in a deal – sure enough his very wealthy father acquired the team. It was always clear that the younger Stroll was in F1 due to a sizeable pot of cash. Recently, Motoring Weekly wrote about FIAT Chrysler trying to stop Mahindra from selling a vehicle in the US, showing just how competitive this industry is.

Tata has struggled in a different way. Remember the Nano? This was supposed to be the volkswagen of India – the “peoples car”. However it was dogged from the beginning by politics, poor quality and poor strategy. What hurt it the most was that it was cheaper than any other vehicle in the marketplace and that had an interesting side effect: people wouldn’t buy it because they thought it would show them to be the poor members of their community!

Tata have tried to create a new brand for the local market called TaMo and the first car was to be a compact sports car called the RaceMo. This was an Indian designed vehicle with input from the famous designer, Marcelo Gandini and the team used an architecture called MOFlex, which is a composite sandwich for the shell with several materials bonded together. It was powered by Tata’s Revotron engine family, specifically in this case a three cylinder 1.2 litre turbocharged motor delivering around 190 hp coupled to a six speed gearbox. A track version was also anticipated in the future.

It was also very high tech – which isn’t a surprise considering the importance technology has in the local economy. When the car was announced, the company claimed it had predictive maintenance, remote monitoring and automatic software updates using Microsoft “Azure” technologies such as analytics, Internet of Things (IoT) and even machine learning!

The RaceMo was launched in Geneva last year with a plan to go into full production later this year, however in March, Tata announced that it had shelved the whole project. That was after they had shown a new electric version earlier this year and suggesting last year that the project was doomed! The company is shutting down many projects that are absorbing costs and not providing any revenues to balance the flow. Some reports suggest that Tata’s commercial vehicle business is struggling and that is where the money is being directed.

Tata are considering selling off the whole project, so if you want your own sports car brand, there is one here for you – ready to go, all you need is a large wallet! Interestingly, Tata have recently signed a cooperation agreement with Jayem Automotive to produce performance cars under the JTP moniker, perhaps this is a cheaper option for them and one wonders why they didn’t throw the RaceMo under that agreement.

Another option would be to consider their other sports car and electric brand: Jaguar. There would have to be economies of scale in using the electric power-plant from the i-Series Jaguar in the composite shell made in India. With a little tweaking, the Jaguar design language could be moulded into the front and rear of the sports car and sold globally.

I wonder what bits of this project will appear on vehicles within the group and whether the cutting of future projects will save the commercial business or trigger other sell-offs. Sometimes it’s better to cull the old loss making divisions and concentrate on new technology with a brighter future.