| Tata Motors may have shocked the market with a larger-than-expected loss of Rs 2,500 crore on a consolidated basis, but the company is confident of turning things around. Non-executive vice-chairman Ravi Kant told ET NOW's Senior Editor R Sridharan that the company should be back on track soon. In the past few months there's been a steady improvement in sales figures at Tata Motors. Do you see a turnaround happening? Yes, last year was quite terrible because of shortage of retail financing. Many important banks withdrew all of a sudden. October-December quarter was bad. Since then month-on-month we have been improving. All the segments have more or less turned back to normalcy, except the heavy-truck segment. It is also improving, but it's slow. When do you see a recovery happening in commercial vehicles? Except heavy trucks, the recovery is already there. In the small-truck segment we have done much better. It has grown over 20%. This is mainly on account of the new truck Ace. We have some availability problems for some parts. Otherwise, we could do even better. Tata Motors' losses for the last year at Rs 2,500 crore were way above what most analysts had factored in. What contributed to these losses? A month ago we had announced standalone results. We showed profits of little more than Rs 1,000 crore. On a consolidated business, we turned out a loss. Mainly it came from Jaguar Land Rover and less profits made by other subsidiary companies. It was the first time we were declaring our consolidated results after taking over JLR. Your interest outgo at Rs 1,900 crore seems a little steep. Are you planning to reduce your interest burden through some debt restructuring? The focus is on availability of money rather than the cost of money. It is difficult to go for equity at this stage. In a bridge loan also, when we tried to go for equity issue, as the market had tanked, it had to be saved by our major shareholder Tata Sons. They had to take the entire burden. It was not the right time to raise equity. Hence, the only way to do was to go for debt, and debt has a cost. Therefore, at this stage, the focus is on making money available. That means no capital expenditure, no product launches for the moment. No. That is not correct. We have tried to reduce our capital expenses substantially. Most of it is for adding to the capacity and less to do with product launches. We have ensured that in Jaguar Land Rover and in Tata Motors or any other company, we do not impact the product plan. Ratan Tata has said that Tata Motors mistimed the purchase of JLR... What would have been a more appropriate price? Mr. Tata didn't mention price. He just mentioned time. When we made the acquisition we didn't know about the global meltdown... I think we paid the right price considering the fact that this company made a profit of $500 million in 2007. It made a profit of nearly $450 million in the first half of 2008. You can't say that it was overpriced. In fact, out of the $2.3 billion that we paid for it, $600 million came back into the pension funds. Ford only got $1.7 billion. I am very sure that in two years' time, when this company starts making profits, we can discuss this again and find out whether we overpaid or not. You're saying that you'll turn this around in two years flat... Yes. How much of the turnaround will depend on the market picking up and how many internal factors can you control? Most of the action is internal because we can't change the economic situation. We are having some serious discussions, strong plans to reduce our cost and reduce our break-even points. Some of this is being done, but a major offensive has to be put in place. This will be good for the organisation as it will give them a very sustained, strong position. Automobile industry is a cyclical business. We should be prepared in advance when things go down. So, a lot of work is being done internally... We just launched Jaguar XF last year, which has got a tremendous response and for this reason, though Land Rover sales declined, Jaguar sales have been where they were. Next week we are launching the new sedan XJ. What cost-cutting targets do you have at JLR? They are extremely substantial and aggressive. I can't share figures. JLR is known for excellent engineering skills. How do you plan to translate that into your own product lines? These are two different entities in two different markets. There can be a lot of diffusion of skills residing in JLR and Tata Motors. We have already begun that in the areas of purchasing, upgrading quality, reliability and workmanship. Over a period of time, both companies will see the value that they can absorb from the other. | 
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