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Should Ford sell Jaguar?


chb
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I Saw this a while ago and thought I'd share it.

I do wonder how it would affect LR, as they allready share engines etc.

charlie

The Skeptic

Ford Should Sell Jaguar

By Howard Wheeldon

A DOW JONES NEWSWIRES COLUMN

LONDON -- With little sign of a revival, Ford is showing increasing signs of losing the plot with its ailing U.K. Jaguar subsidiary.

Ford should consider putting the for sale sign on the whole Jaguar operation. Having nurtured the brand for so long and poured in vast amounts of investment, it might even get the original GBP1.6 billion back it paid in 1989.

Instead, the Dearborn, Michigan-based parent plans to cut production rather than capacity at Jaguar's Halewood and Castle Bromwich plants next year, lowering planned output below 80,000 units.

And it wants to sell the all but redundant Browns Lane plant in Coventry.

That's not going to turn Jaguar into a force in a niche premium car market. The dream of producing 200,000 cars a year was long ago abandoned and it will be several years before Jaguar will be producing 100,000 cars.

With so many other problems to sort out across Ford's global empire, the parent shouldn't waste more money and management time on Jaguar.

After 16 years of Ford ownership and large-scale investment, Jaguar has yet to live up to its still-strong brand. With a lowly market share in a fast growing segment, Jaguar is starting to look like a spent force despite its pretty fine cars.

Comparing output with competitors like BMW shows the depth of the Ford Jaguar problem.

Just three years since it passed the one million unit mark, BMW will this year produce over 1.3 million cars. Even Mercedes Benz, struggling with quality and a host of other problems, will sell 1.2 million units in 2005.

To make things worse, Jaguar has other fast-growing European based competitors to worry about, such as a fast growing Audi, which plans to be selling one million cars by 2007.

Even leaving aside fast-growing Japanese premium competition like Toyota Nexus, the chances of Jaguar gaining ground look slim.

Biting the bullet on Jaguar must be inevitable unless the carmaker's fortunes can be reversed over the next two years.

Having paid far too much in 1989, given Jaguar its head, and poured in substantial plant and model investment aimed at producing 200,000 units by today, all Ford has to show investors is too many years of losses.

Ford shareholders deserve better than that.

Further cutting production without slashing jobs will be seen as a signal that Ford believes Jaguar's poor performance has more to do with weak market demand than with the absence of models customers want to buy.

If Ford's other premium brands, such as Land Rover and Volvo, can make a profit in difficult markets, Jaguar really has no excuse.

But to succeed, it needs a bottom-up design review that abandons its history and looks radically different from anything the company has ever produced. Jaguar's models don't look much different than they did more than a decade ago.

Volvo, Land Rover and even the now profitable Aston Martin give Ford more than enough European premium car product to handle.

(Howard Wheeldon was a senior equities analyst for 20 years, and has been a columnist at Dow Jones for the past three years. He can be reached at +44 207-842-9251 or by e-mail: howard.wheeldon@dowjones.com)

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Well I would buy a Jag over a BM any day even if it is not quite as good at 180mph in a wet corner on a track day.

A bit like the new Aston vs BMW M6 vs Porch Beetle that was on Top Gear here the other day:-

The choice of classic British (with the emphasis on the "ish" these days) elegance versus a car that a drug dealer would have to wear a bag in... ooh let me think about that for a second.

Jags don't look that different because they got it right the first time IMHO B) you only need to keep faffing around with a design if it dates quickly. Did anybody say "Defender"?

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