Tata eyes research unit in Coventry

Nodz86 · April 3, 2008

Tata eyes research unit in Coventry

Apr 1 2008 By John Duckers, Business Editor

Indian group Tata – fresh from acquiring Jaguar and Land Rover – is now expected to press ahead with a major new multi-million pound research and development unit in Coventry.

The company’s European Technology Centre has long been earmarked for part of the Ansty site alongside Swedish group Ericsson – its R&D complex is currently under construction.

A full launch of the ETC had been due by now but the Jaguar Land Rover deal saw it put on hold and Tata is now thought to be re-thinking elements of its strategy.

Sources still expect the base to come to the Midlands, albeit some believe it might end up not at Ansty at all but nearer the current Jaguar technical centre at Whitley.

"We are still working with them to make it a reality," said John Edwards, departing chief executive of regional development agency Advantage West Midlands.

It is thought that various Government and AWM incentives adding up to £40 million worth of public money could be available to lure Tata in.

Architects and a project team have already been appointed.

Quite when a go-ahead will be announced is not clear, but it is suggested that if Tata does agree to choose Ansty then detailed planning consent could be granted by around September.

"We would expect to see the building operational by the end of 2009 or the beginning of 2010 at the latest," said Mr Edwards.

It would see the current more limited research operation based at Warwick Manufacturing Group, where Tata employs 150 people, switch to the new complex. Over three to five years that would then build up to around 1,000 staff.

It would effectively give Tata three R&D centres in the Midlands – the Gaydon and Whitley operations serving Jaguar and Land Rover have been purchased as part of the takeover from Ford.

Tata is said to be comfortable with all three, albeit one theory is that Gaydon may end up as the R&D centre for all of JLR, with Whitley becoming more of an administrative unit.

The ETC would have a wider role for the global Tata group.

It will work for both Tata Motors and Tata Consultancy Services, the computer services arm which is the fifth biggest in the world, challenging the likes of Oracle and IBM.

Mr Edwards said: "The ETC will take European design, innovation and engineering and apply it to cars Tata produces in India."

In line with running Jaguar and Land Rover separately from Tata’s Indian-based lower segment models, like the Indicar and Nano, the R&D would be kept apart too.

Whether closer R&D integration will be possible in the future is an open question, but that is thought to be at least ten to 15 years off.

And the ETC will also cater for a third subsidiary, Tata Technology & Services, which provides engineering and advice to other group companies and outside firms.

Warwick Manufacturing Group, under Lord Kumar Bhattacharyya, who has worked with Tata for some 15 years, would continue to be a major provider of cutting edge R&D and innovation to the company.

"They will remain a key player with Tata," said Mr Edwards.

He believes that what will emerge overall will be what he calls a "proper partnership" where Tata nurtures Jaguar Land Rover and Midlands engineering skills bolster the group’s operations worldwide.

And Mr Edwards is insistent that this can work for the region on a very much wider scale. He points out that the West Midlands has massive expertise in areas such as automotive, computer and computer games technology, and alternative power systems such as wind energy and hydrogen vehicles.

There is the engineering expertise in areas like gearing and control systems, strong links with universities and backing all this up is a top quality legal, accountancy, banking and professional sector.

"We can sell our technologies," he said. "We have to get the ideas into production."

As for the future of Jaguar Land Rover, Mr Edwards says the Tata deal has removed the uncertainty affecting both.

Tata was in for the long term and was sensitive to the culture of the two companies.

Mr Edwards predicts a new XJ saloon car for next year and confirms a two-seater sports model is a possibility, maybe as a derivative of the new XF.

For Land Rover, expect upgrades for the Range Rover Sport and the Discovery, and a new Freelander concept.

"They have got the products that will take them forward," said Mr Edwards "Tata is very profitable – it generates cash. It has enough money to make this work."

But Ford poured money in and never got the returns it sought.

Mr Edwards said: "Tata will benefit from all the work that Ford has done. Land Rover is profitable and Jaguar will be profitable.

"It is a great accident of timing. The investment is about to deliver."

Which sees the brands set fair on model development for three to four years.

And, with all the pressure on emissions from the green lobby, he sees a future opportunity for Jaguar Land Rover’s diesel expertise – to take it into hybrid technology.

"We are talking about developing the technologies for the future."

That would require all the various parties – AWM, WMG, the universities and suppliers – working together.

"It is about moving to the next level," said Mr Edwards. "Tata will make the commitment but we have to show we can work with them."

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