Tata Motors Is Coming. Good News For Detroit?

Implications: Tata Motors, the Indian automaker that's about to burst on the global scene as the new owner of Jaguar and Land Rover, is the new face of globalization. In the long run, will it be good for Detroit?

Analysis: Tata Motors, the Indian automaker that's about to burst on the global scene as the new owner of Land Rover and Jaguar and a long-term partner for Ford Motor Co., is the other face of globalization.

It is a foreign company that employs hundreds of people in metro Detroit and plans to boost its workforce in the region over the next three years.

At a time when the common perception is that Indian companies pay low wages and take good-paying jobs from the U.S., Incat, Tata's locally based engineering group, just won a contract for its employees in Oakland County to develop a vehicle platform from the ground-up for a Chinese automaker.

The local offices work with facilities in England, Thailand and India to provide round-the-clock engineering on everything from body panels to powertrain development.

Tata Motors and Incat are arms of the Tata Group, a company that employs 289,500 people worldwide, does business in more than eighty countries and accounts for 3.2 percent of India's GDP. The group employs 19,500 North American workers.

Tata Motors is the most visible part of the company, gaining worldwide prominence this year with the introduction of its $2,500 Nano-a subcompact designed to be India's Model T, the car that puts the nation's capital on wheels-and its pending purchase of Jaguar and Land Rover from Ford.

The Tata Nano is the kind of car upon which empires are built. Its also a direct challenge to the worlds leading automakers and the Indian government.

Whether people in Detroit, London and Tokyo are amused or excited by the little two-cylinder Nano is irrelevant.

What matters is that the 122 inch long Nano could the first car a few hundred million people in the developing world dream about, and how many of them attain it.

The Model T was a car like this. So was the Volkswagen beetle. Their appeal and affordability put people around the world behind the wheel for the first time.

A word of caution. Some analysts say Tata could maintain its first-mover status for two years or more, but rising commodity prices could soon put the heat on that $2,500 price tag.