Subprime mortgage

loan+

Adjustable-rate

mortgages

House demand

increases

Housing

bubble

Mortgage Loan

Mortgage-backed

securities

Investors

Premium

Credit Default Swaps

Housing

bubble

Housing

bubble

House prices get too high

House prices get too high

House builders increase

production

House builders increase

production

Supply > DemandSupply > Demand

House prices drop

House prices drop

Subprime Mortgage

Crisis

$500,000

MBS

CDS

Main providers of capital

Credit Crunc

hGlobal

Financial Crisis

2.1) Trade and trade price

2.2) Equity investment and foreign direct investment (FDI)

1) World wide slumping in Automobile’s sales and

production

TableWorld car sales and production by sub-regions 2007-2009

( change in %, year on year basis)

Source: Automotive World Automotive Passenger Car OEM Quarterly Data Book, Q2, 2009. Reclassified data calculated from rounded off data Note: #) NAFTA and South America figures (include light trucks)

2) Facing bankruptcy

3) Automotive firms’ actions

The decline of industrial production, retail sales, world trade, and consumer confident index in between year 2008 and year 2009

Unemployment rate

Government policies

The deficit in the fiscal balance for those developing and developed countries and also the increasing of public debts.

Source: Wikipedia

List of countries by Gross National Income per capita at purchasing power parity in 2009:

Overpay for the acquisition and fail in gain desired benefits.

Create synergies in the capabilities between the two companies

Acquisition being done during financial crisis and automobile crisis

Anyway, Jaguar and Land Rover start generate income for Tata Motor in year 2010