New Delhi: Tata Group chairperson Natarajan Chandrasekaran is known to be someone who trusts his inner circle of leaders to accomplish the task he has assigned them.
The announcement of group chief financial officer of Tata Motors P.B. Balaji as the new chief executive of British luxury brand Jaguar Land Rover seems to be an example of the long-running instinct of the 62-year-old chairperson of the salt-to-steel conglomerate.
Late on Monday night, the news of the appointment of Balaji emerged just days after it was known that the current chief executive officer (CEO) Adrian Mardell was on his way out. Mardell was JLR’s finance chief before taking over as its CEO.
Although Mardell’s decision to retire became public just two months after the automaker assured investors that the company’s growth journey was on track, Chandrasekaran’s statement on the appointment of Balaji as the new helsman suggested that a search was on for a few months.
“The search for a suitable candidate to lead JLR has been undertaken by the board for the past few months and after careful consideration it was decided to appoint Balaji. He has been associated with the company for the past many years and is familiar with the company, its strategy and has been working with the JLR leadership team,” Chandrasekaran said.
The search efforts converged on Balaji, one of the first few leaders hired in the Tata Group nine months after Chandrasekaran took over the leadership of the conglomerate in February 2017. Balaji is one of the trusted hands for Tata Motors, and Chandrasekaran recently praised the turnaround of the company, particularly its finances.
“Here, let me pause and mention one example that exemplifies the best of what we can do: Tata Motors,” Chandrasekaran said in his letter to shareholders of Tata Sons.
“With barely 5% share in passenger vehicles in 2017, it seemed an implausible idea that Tata Motors could launch India’s first electric vehicle in under one year from design to production, that its market position could rise from 6th to top-3 in the Indian market, that it could transform from a debt of ₹62,000 crore to net cash positive status,” he added in his letter.
A lot of the credit for this turnaround at Tata Motors could be attributed to Balaji, who joined Tata Motors in November 2017.
“PB Balaji has the chairperson’s backing and his trust, given the work he has done over the last few years,” said Naveen Khajanchi, CEO and director at NKH Foundation Pvt Ltd, a leadership coaching firm.
In Chandrasekaran’s eyes, the automobile business holds significant importance, as he put in his address to shareholders.
“I had the opportunity to constantly share updates with Ratan Tata about the business in the last few years. While we all miss him, I want you to know that he would have been very proud of the turnaround of the business as Tata Motors was very close to his heart,” Chandrasekaran told shareholders.
And for the good health of the automobile business, JLR holds utmost importance. In FY25, the company contributed 71% to Tata Motors’ consolidated revenue of ₹4.4 trillion.
Given the flux in the global automobile markets, thanks to Trump tariffs and China’s curbs on rare earth magnets, the timing of the move couldn’t be more crucial for Jaguar Land Rover and Tata Motors. The country’s third-largest car maker will demerge into two separate entities for passenger vehicle and commercial vehicle businesses.
The UK-based JLR is facing headwinds on multiple fronts. The imposition of tariffs by the US president Donald Trump’s administration has meant that sales in its largest market could slow down. Moreover, it is facing challenges in the Chinese market as domestic brands there continue to surge.
Balaji’s appointment also comes at a time when the head of state of its biggest market – United States – has publicly slammed the brand for its “woke” advertisements and rebranding exercise.
“The CEO just resigned in disgrace and the company is in absolute turmoil,” US president Donald Trump wrote in a Truth Social post.
In 2024-25, JLR’s revenue fell 0.1% to £28.9 billion, while profit after tax declined 30% to £1.8 billion. Retail sales declined 0.6% to 428,854 units. The company has also guided for 5-7% margins in the current financial year, down from 10%.
“Balaji has proved himself with financial turnaround and health of the automobile business. But now being the CEO of an automobile company, he will have to look after the innovation, design and competitiveness of the brand,” Khajanchi noted.
European automakers are being challenged in their home market by Chinese rivals BYD. Moreover, JLR is undergoing a transition under which it has discontinued all the models of Jaguar, barring one, as it moves towards an all-electric positioning.
When he takes over in November this year, Balaji will have to navigate Trump’s tariff tantrums, uncertainty in global markets, severe competition from China and an electric transition.
Analysts’ commentary on the near-term prospects of the company has been anything but positive.
“JLR is facing multiple headwinds, which include tariff-led uncertainty for exports to the US, demand weakness in key regions like Europe and China, and rising VME (variable marketing expenses), warranty and emission costs,” analysts at Motilal Oswal Financial Services wrote in a 10 June note.
Agreeing with the observations in the Motilal Oswal note, Raghunandhan NL, Manav Shah and Rahul Kumar of Nuvama Institutional Equities said the path ahead for JLR appears to be difficult in the near term.
“In JLR, discontinuance of ‘Jaguar’ models, loss of market share in the China region and imposition of tariffs in the US region, shall lead to a volume contraction ahead,” the analysts wrote in a 10 June note.
Investors also seem to be jittery about the company, with shares of Tata Motors declining by 13% in 2025 so far as against a 3% rise in Nifty Auto.
The history of the role Balaji is inheriting wouldn’t give too much confidence, barring one exception.
Since the takeover of JLR by Tata Group in 2008 for $2.3 billion, there have been four chief executives. Former Ford executive David Smith, who steered the company between 2008 and 2010, left at a time when the British brand saw its sales fall by more than a fifth.
Taking over from Smith was Ralf Speth, who had stints at BMW and Ford, before joining JLR. The executive led the company for nearly a decade before stepping down in 2020, the year Covid-19 ravaged sales of automakers globally.
Thereafter, former Renault chief executive Thierry Bolloré took the reins, setting the company on a path to full electrification. However, Bollore stepped down in 2022 citing personal reasons, and was replaced by Mardell, an old-timer at JLR who has been with the brand since it was taken over by the Tatas.
As most of his predecessors had experience of working with automobile firms with luxury brands, Balaji’s choice may seem unorthodox. However, he is someone who is well entrenched across the Tata Group, even with firms with whom JLR will have to work closely in future.
The former Unilever chief financial officer, Balaji also serves on the boards of Titan, Air India, Agratas Energy and Tata Consumer. Agratas is building a 40 GWh electric vehicle battery manufacturing plant in the UK whose anchor customer is going to be JLR.
Balaji has been a key financial architect and a turnaround man for Tata Motors for eight years. Now, as CEO, his ultimate test would be whether he can fashion a similar revival for JLR, which is going through its most challenging period in a decade.