March 2008: Ratana Tata at a press launch. [photo: Alamy]
[This article originally appeared on the webpage Riding the Elephant and is reproduced with the kind permission of the author.]
A young US-based architect who became India’s leading industrialist
Love of aircraft, cars and dogs influenced his business and his life
Ratan Tata, who has died age 86, was the most notable Indian industrialist of his generation. No-one has bestraddled Indian business in the way that he has done at Tata Sons for over 30 years, hugely expanding, and then presiding in semi-retirement, over a group that has revenues of well over $100bn. At the same time, he trailblazed investment abroad and built the international image of Tata and of Indian business.
Tata wanted to be an architect and had no apparent wish to join, let alone run, India’s biggest and most respected conglomerate that bore his name. However in 1962, having received an architecture degree at New York’s Cornell University and worked in Los Angeles, he was pulled back by his uncle, J.R.D.Tata, who saw him as a possible successor to head the group.
Thus began the business career of this shy man, who loved cars, aircraft, and dogs. All three affected what happened at Tata.
He had a famous collection of cars and, among several motor industry achievements, he personally led the purchase of the UK-based Jaguar-Land Rover group from Ford.
During seven years in the US, he learned to fly, once partially losing engine power in a helicopter and twice losing the single engine in his plane. “So, I had to glide in,” he told an interviewer. In 2007 he flew in the co-pilot’s seat in F-16 and F-18 fighter jets at the Bengaluru air show.
He pushed the group into aircraft and other defence manufacturing with Lockheed Martin, Boeing and others. He pursued various ventures with Singapore Airlines and, exerting influence after retirement, insisted the group bought floundering Air India out of public ownership in 2022, retrieving the national airline that Tata had founded and lost to nationalisation in 1953.
His love of dogs led to them being allowed into the hallowed entrance hall of Tata’s head office in Mumbai where there was a specially built shelter. It also led to a close friendship with Shantanu Naidu that began ten years ago when Naidu and his friends designed dog collars with reflectors to help strays’ safety at night. Naidu became Tata’s protégé, and eventually the young general manager in his office. Yesterday, Naidu rode a motor bike in front of the coffin for part of the funeral procession though Mumbai. He told their story in a short book published three years ago I Came Upon a Lighthouse: A Short Memoir of Life with Ratan Tata.
A complex character, Ratan Tata never married, though he has said that he almost did four times, including to someone who did not join him when he left Los Angeles. For his women friends, he was a gallant and chivalrous, if somewhat reticent admirer. For other friends, acquaintances and staff, he mixed an extremely shy demeanour with firm executive toughness. Kumarmangalam Birla, a prominent Mumbai industrialist, said on India Today television yesterday that Tata had once told him “My worst fear is to face an audience”.
Watching him in the years following my first interview (for the FT) in the mid-1980s, when he had just been given executive authority for new investments, I realised how he tended to be over-trusting and how deeply he felt personal hurt. In 1996, after another interview, I wrote a piece in The Economist that was heavily edited. The published version compared him and his satraps with feudal rule in medieval England under the headline At the court of King Ratan. Unsurprisingly, Tata was not impressed.
This characteristic made him ultra-sensitive and unforgiving over slights, not just over what he regarded as unfair media coverage, but also with people in the group who displeased him. A senior executive, Mukund Rajan, said during India Today’s long special coverage yesterday, that in the 1990s Tata showed a great sense of humour with colleagues. The “jokes started vanishing” later and he became isolated from people he had trusted.
That isolation may have worsened the low point of Tata’s distinguished career after he chose Cyrus Mistry to succeed him in 2012 as executive chairman of Tata Sons, the group holding company. The Mistry family owns about a fifth of Tata Sons shares. Mistry, and abrasive advisers he brought with him, fell out with Ratan Tata, who organised a boardroom coup in 2016 to remove them.
Mistry (who died in a 2022 car crash), was replaced by a top group executive who Tata could trust – Natarajan Chandrasekaran, then heading the highly successful IT company, Tata Consultancy Services. Chandrasekaran has brought stability to the group and has managed in the last eight years to take top executive decisions without the patriarch feeling shunned or excluded.
Tata’s authority till the end has been as chairman of the charitable Tata Trusts that have a controlling interest of about 60%. He personally owned less than 1%. That marks the group out from other big family-owned Indian companies, giving it a philanthropic role along with its professional management.
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Ratan Tata was born in 1937 to a family of Parsis, the well-educated and prosperous Zoroastrian community that plays a major role in Mumbai’s business life.
When he returned to India from the US, he started on the factory floor at the group’s big steel plant in Jamshedpur in eastern India, and then became technical assistant to the manager. In the early 70s, he turned round two problem companies making radios and televisions, but was disappointed to have failed to save a textiles business. In the mid-1980s, he was given charge of Tata Industries, a subsidiary that initiated and developed new investments.
In 1991, J.R.D.Tata, the revered head of the group, caused concern when he named Ratan Tata as his successor. “J.R.D. got clubbed with nepotism and I was branded as the wrong choice,” Tata said in a Facebook interview.
He was widely expected to fail, but instead he asserted his authority over the group that then had revenues of just $4bn. He gradually unified group companies, several run by powerful satraps who he retired. He closed some lossmakers and then set out to expand abroad. “It was the quest for growth and changing the ground rules to say that we could grow by acquisitions which earlier we had never done,” he said in 2013.
He started by buying UK-based Tetley Tea in 2000 for $432m, followed by the commercial vehicle unit of South Korea’s Daewoo Group for $102m. At the time, these were unprecedented acquisitions for Indian companies which, satisfied with the vast home market, never ventured abroad,.
Next came the Anglo-Dutch steelmaker Corus in 2007 for $13bn, which Ratan Tata insisted on buying against the advice of senior executives. It has never been a success. That was followed by Jaguar Land Rover in 2008 for $2.3bn, where Tata introduced strong management and harnessed plans and designs that Ford had failed to implement. Though there have been problems, he made the troubled brands an international success,
In India, Tata Motors produced the Indica medium-sized saloon which was the first car designed and developed in the country. Later there was the unsuccessful Nano micro car, which Ratan Tata unwisely pursued as a personal crusade against advice from his executives.
After he retired in 2012, he became a significant investor in Indian start-ups that included digital payments firm Paytm, an electric scooter spin-off from Ola that rivals Uber. Another start-up, Goodfellows, founded by Naidu, that encouraged friendships between older and younger Indians in business and other professions, is said to have been a favourite.
Honours have included India’s second highest award, the Padma Vibhushan. Abroad he has a British knighthood and awards from France, Italy and Japan. Among a mass of tributes yesterday, prime minister Narendra Modi said he was ” a visionary business leader, a compassionate soul and an extraordinary human being.”
He is survived by his younger brother Jimmy Tata who is not involved in the group, his 94-year old stepmother Simone Tata who has her own businesses, and stepbrother Noel Tata, who heads part of the Tata group and has today been appointed chairman of Tata Trusts.
That blend, between the professional management of Natarajan Chandrasekaran as chairman of Tata Sons, and Noel Tata leading the family-controlled trusts, should ensure the continuity of a group that Ratan Tata built to such a size that it is too big and important to be allowed to fail.
John Elliott is a member of the Round Table editorial board.
