Ratan Tata, 1938-2024

Ratan Tata, who has died age 86, was the most notable Indian industrialist of his generation. No one has bestrode Indian business in the way that he did for more than 30 years, running and then presiding in semi-retirement over a group that has revenues of over US$100 billion. 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 (he was a pilot), 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. Though there were problems, he made troubled brands an international success.

He pushed the group into aircraft and other defense manufacturing with Lockheed Martin, Boeing, and others – and in 2007 he flew in the co-pilot’s seat in F-16 and F-18 fighter jets at the Bengaluru air show. Exerting influence after retirement, he insisted the group buy floundering Air India out of public ownership in 2022, retrieving the national airline that Tata had founded and lost to nationalization 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 10 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 motorbike in front of the coffin for part of the funeral procession through 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 demeanor 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 Financial Times) in the mid-1980s, when he had just been given executive authority for new investments, I realized how he tended to be over-trusting and how deeply he felt personally 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 the 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 humor 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 organized 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 percent. He personally owned less than 1 percent. That marks the group out from other big family-owned Indian companies, giving it a philanthropic role along with its professional management.

Among a mass of tributes yesterday, Prime Minister Narendra Modi called him a “visionary business leader, a compassionate soul and an extraordinary human being.”

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. He spent seven years in the US where he learned to drive cars and 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. 

Returning to India, he started on the factory floor at the group’s big steel plant in Jamshedpur in eastern India, and then became a technical assistant to the manager. In the early 70s, he turned around 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 US$4 billion. He gradually unified group companies, several run by powerful satraps whom he retired. He closed some loss-makers 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 US$432 million, followed by the commercial vehicle unit of South Korea’s Daewoo Group for US$102 million. At the time, these were unprecedented acquisitions for Indian companies which, satisfied with the vast home market, had never ventured abroad. 

Next came the Anglo-Dutch steelmaker Corus in 2007 for US$13 billion, 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 US$2.3 billion, where Tata introduced strong management and harnessed plans and designs that Ford had failed to implement.

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 favorite.

Honors have included India’s second highest award, the Padma Vibhushan. Abroad he has a British knighthood and awards from France, Italy, and Japan.

He is survived by his younger brother Jimmy Tata who is not involved in the business, 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 Asia Sentinel’s South Asia correspondent. He blogs at Riding the Elephant.