TATA MOTORS has made its name in India by producing rugged cars for the masses. It recently unveiled the Nano, a simple runabout that will go on sale for £1,250.

There is no obvious link between this part of the Tata empire and Jaguar, an upmarket saloon brand. But there is a clear fit with Land Rover, a maker of rugged - and at the top of the range, glamorous - four-wheel-drive vehicles. Tata was making this kind of vehicle long before it branched out into conventional cars.

These utility vehicles - in India they are not called sport utility vehicles for good reason - are long in the tooth; old designs with bought-in engines. They don’t bear comparison with the modern equivalents from Europe, Japan and America.

Land Rover’s expertise could be used to upgrade Tata’s models, allowing rapid replacement of the current Safari and Sumo with vehicles that would be suitable for worldwide sale.

As well as the Indian sub-continent, there is great potential for low-cost 4x4s in Asian markets. Tata could offer these new vehicles as a less-expensive range through the Land Rover dealer network.

Part of Land Rover’s success - it has had three years of record sales and profits - is because it has remained faithful to its origins. All its models have four-wheel drive and are capable of crossing rough and difficult terrain.

Of its competitors, only Chrys-ler’s Jeep has a similar reputation. In western markets, few customers make use of this off-road capability but it is enshrined in the Land Rover ethos.

Although the maid-of-all-work original Land Rover made the brand’s reputation, its position today as the king of 4x4s is due to the Range Rover, introduced in 1970 as the first luxury car with off-road credentials.

Today’s Range Rover was expensively engineered during BMW’s ownership of the Rover Group and inherited by Ford when it took over Land Rover in 2000.

The Range Rover established the idea of a premium 4x4, and the Land Rover range - which includes the Range Rover Sport, Discovery, Freelander and Defender - has stayed a cut, and price, above most of its competitors. Perhaps that is why the company has taken the brunt of the environmentalists’ backlash against 4x4s.

Yet despite being condemned for making cars that are too large, use too much fuel, and emit too much carbon dioxide, Land Rover has not seen a slow-down in sales. But that may come as more European countries apply extra taxation based on carbon-dioxide emissions.

The European Union’s proposals to limit the fleet average carbon-dioxide output by each carmaker to 130g/km would seem to make life impossible for the new Land Rover and Jaguar.

The lowest carbon-dioxide rating of any Land Rover is 194g/km - for the Freelander TD4 - and the most frugal diesel-engined Jaguar XF only just gets in below 200g/km.

Jaguar and Land Rover figures were to have been combined with Ford’s, but the best hope for the stand-alone company is that the EU will grant exemption to manufacturers that make fewer than 300,000 cars a year.

Exempt or not, Land Rover knows that it must move towards more fuel-efficient vehicles and has a plan to introduce a range of energy-saving measures over the next three years. Its future cars will be lighter, using the aluminium technology pioneered at partner Jaguar.

Early next year the Freelander will be equipped with a fuel-sav-ing system that stops the engine when the car comes to a halt and restarts it automatically.

The LRX concept car exhibited at motor shows was presented as a hybrid with a diesel engine at the front and an electric motor at the rear axle. Its car-bon-dioxide target is 120g/km.

The LRX is smaller than any current Land Rover. It is also a more friendly kind of 4x4, a crossover between an off-roader and sporty coupe.

In 2010, petrol and diesel-engined versions will be ready for production alongside the Freelander on which it is based. The hybrid will come a year or two later. Officially, the go-ahead awaits approval by the new owners. Pledged to building on Land Rover’s present success, Tata seems certain to give it the green light.

Ravi Kant, Tata Motors’ managing director, gave the Jaguar and Land Rover product plans his blessing last week when he appeared at the Bangkok Motor Show. “We have seen the business plan for the next five years proposed by the management and we have bought in to that business plan fully,” he said.

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