So Ford has officially confirmed the sale of Jaguar and Land Rover to upstart automaker Tata. While it’s likely to be years before anyone can conclusively say that the move was good or bad for any of the parties involved, we wonder what you have to say on the subject. Will the Jaguar/Land Rover sale end in tears or triumph for Tata? Will Ford regret the move? Give us your answer, in comments.
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IMHO, I predict it will be good for Ford (focus - no pun intended - is always a good start when trying to turn around a business), it will be good for Tata (they will flog these like crazy in emerging economies), but it will be bad for Jaguar and Land Rover (they will lose their prestige and desirability in western nations).
Ford for the win.
Jaguar and Land Rover were duds. The LR tried to be a hot hip-hop item (Ford’s Euro Escalade), but failed with dreadful reliability. Ford helped bring Jaguar from the brink, but never found the right direction.
I think the Aston factor hurt Jag, too. Ford’s unwillingness to build the higher-end XKR-R showed that. I also feel the present XK and XF were styling failures. (Much like diesels in California, there’s no great demand or excitement.)
I think Dave’s right. Selling off three motor divisions frees up time and money for R&D in better vehicles. Volvo and Mazda have more purpose, but I’d like to see them go, too. I don’t know what Tata will do with them, but one should remember that Lamborghini SpA was a property of a Polynesian equity firm in the 1990s. That didn’t hurt the Diablo in the eyes of car lovers.
Ford? No problem. Job well done. As for Jaguar and Land Rover…
Does anybody think any less of Lotus because it’s owned by a Malaysian auto manufacturer called “Proton”? Or that Toyota makes Lotus engines?
The answers are “no” and “no.”
Seyth,
“Acquiring FORD assets for ‘pennies on the dollar’ (sale price versus acquisition costs by FORD) is excellent accounting by TATA.”
Financial INSANITY for Detroit’s historic ‘glass house’.
Forecast, observe TATA achieve success with BOTH assets going forward.
the regret is in the purchase
Good points about Lambo and Lotus. My only counter argument would be that those were niche brands that gave you a reason to buy - performance. LR and Jag are mainstream brands, who’s sale to India is well covered by the press, who develop cars that there is no reason to buy other than brand prestige (exception being the Defenders).
BMW seems to cope well with life after Land Rover.I doubt Ford will need a support group. With Germans making Rollers and Bentleys, and now the Indians making Jaguars, the sun has truly set on the British Empire.
Ford may regret selling the British brands, but they’ll not have much time to think about it until they get their own business back in some state of health. By then, with Tata’s support, Land Rover will be selling the super-cool LRX like hotcakes, and Jaguar (hopefully) will be launching the F Type Roadster - that Ford should have funded years ago. If Ford’s attention focused on the US brands really helps them to recover, then today’s transaction will be a win/win.
I think it is a win for Ford. British cars have a terrible reputation in the US that was earned in no small part by Jaguar before Ford bought them. If Jaguar continues to build decent quality cars, they may eventually outlive the reputation they earned in the 1970’s & 1980’s; but I don’t think Ford can afford to bleed money waiting for Jaguar to regain a good reputation. Right now if you have $50k-$100k to spend on a new car, your choices are Mercedes, BMW, Porsche, Lexus, Infinity, or Jaguar. If you chose Jaguar, you eat more depreciation in the first year than any of the others do in 3-4 years!
Often to restart a business you need to make it smaller. This approach may cause Ford to lose some opportunity with Jaguar, but if selling Jaguar is the price of getting rid of Land Rover, then it is a winning transaction.
Will,
You must be confused. Last year Land Rover made about $1.5 billion for Ford, while Jag lost them almost $500 million. Tata only accepted Jaguar because Ford required that they take it off their hands in order to be allowed to purchase the successful Land Rover division.
They may regret having lost money on the deal from when they aquired Jag and Land Rover, but not the actual sale itself
I see this being a better deal for Jag/LR then for ford in the long run. ford just spent money on the new XF, the recently introduced LR2 and updated both range rover and range rover sport. this gives tata time to re-do all of these cars the “correct way” not the half-assed ford way. Jag can finally get the attention they’ve needed for a long time with the financial backing that haven’t seen from ford in a long time. case in point, look at Aston Martin. since they were bought out they’ve become more appealing and are going to become better cars in the long run. I doubt ford would have let the DB9S or whatever it’s called happen due to “cost”.
Jed,
So if Ford made a combined 1 Billion dollars off the two brands last year, why on earth would they sell them? They don’t seem to make money on their Ford brand; why didn’t they just sell that to become Land Rover/Jaguar?
In terms of land rover, not so much. It barely made any money anyways for ford, and in the current recession we’re having, land rovers are going to be a less popular choice.
As for Jag, i was optimistic about the new XF. Is it good enough to revitalize a dying company? Maybe, but it still would make ford lose money in the end.
I saw an XF out in front of the local Jag dealer the other night…would have stopped for a closer look but I was taking food home. I sure liked it, though. I think Ford won’t have seller’s remorse considering how this should positively affect their budget, but it still makes me a little sad to see them go.
Well at the end of the day land rover might have brought in 1.5 billion but how much did ford spend on manufacturing, development, and other costs? Obviously ford finally has woken up and is starting to cut off the fat. Now all they need to do is build cars that people actually want to buy and they will be set.
The 1.5 was profit - that is to say after the costs of manufacturing, development, etc. Land Rover was the single most profitable division of Ford last year. To Josh, who asks why Ford sold it… Good question!
I’m sure Ford is glad to see it go and won’t miss it. It never made any money and never looked like it would. A costly and long distraction for Ford is now over.
William Clay must be very disapointed, he loved his Jags. His Lions seem to follow the same path of not winning.
The company may well see this as an important improvement, but in the long term ?? - they will still need some high end products other than trucks.
I think it’s unfortunate for Ford that the sale of Jaguar coincided almost to the day that the most beautiful car in the world (and one of the best according to the just-published Winding Road)-the XF - was launched. Amazing how subjective things can be; the only quibble Winding Road had with the XF is its face, which to me is a heart-stopper. Can’t wait to see one in the metal.
Good for the customers..Instead of treveling all the way to the Rover dealer for the bi-weekly repair/service, maybe now can just go to the nearest 7-11!
Tata own Corus (formerly British Steel) a company that most probably provides all if not most of the steel for every car made in the UK. Their purchase of Jaguar and Land Rover is one way of adding value to the steel that they manufacture. Tha Tatas also sit on the board of Fiat and one of the Tata companies works on the software and design of Ferrari Formula 1 engines. They are not pushovers in technology except in the minds of some trailer-redneck in the back of beyond. Before they went ahead with their plans to buy Jaguar, they got the assurance of Fiat that they would work together with Alfa Romeo and Maserati on sharing design, platforms and components, especially because Corus supply some of these to the premium Fiat brands already.
Add to this the huge market in India where Jaguar did not have a presence under Ford ownership despite Ford being strong in India for many years and a coming tender for the Indian army to buy four wheel drive vehicles (Land Rover, anyone?) and the future of the Jaguar, Land Rover, Daimler and Lanchester companies (Tata acquired the latter brands as they were big in pre Independence India and they wish to offer high end versions of these vehicles in India under those names) and the whole business is quite safe, thank you my concerned friends in the back of beyond.
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