Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Ford sells Jaguar/Land Rover to India's Tata-source
www.reuters.com ^ | 03/25/2008 | By Pete Harrison and Mathieu Robbins

Posted on 03/25/2008 12:42:59 PM PDT by Red Badger

LONDON, March 25 (Reuters) - U.S. automaker Ford (F.N: Quote, Profile, Research) has agreed to sell its luxury brands Jaguar and Land Rover to India's Tata Motors (TAMO.BO: Quote, Profile, Research) for more than $2 billion, according to a source familiar with the matter.

Ford, which signed the deal on Tuesday, plans to publicly announce the transaction in New York at 0800 EST on Wednesday, said another source.

The deal will also see Ford pay about 300 million pounds ($598 million) into Jaguar and Land Rovers' pension funds, according to unions.

Ford declined to comment, adding "our first responsibility is to communicate with our employees."

The sale had been expected at the start of this month, but it was delayed as the two firms discussed their future relationship, including technology sharing and Ford's provision of engines and body parts for the two brands.

Tata, India's top vehicle maker, has been in talks with Ford since it was chosen as the frontrunner to buy Jaguar and Land Rover a few days into 2008.

Tata is pursuing the deal to gain a substantial foothold outside India.

But analysts have questioned how Tata will incorporate the luxury brands into its stable of sturdy trucks and functional passenger cars, including the Nano, the world's cheapest car which it unveiled in January.

While Land Rover has generated three years of record sales with its iconic SUVs, the fit of Jaguar is far less clear. Ford, which lost $2.7 billion in 2007 and $12.6 billion in 2006, is spinning off Jaguar and Land Rover to focus on turning around its loss-making operations in North America.

The sale will include a commitment by Tata to continue buying engines from Ford, according to unions.

All Jaguar and Land Rover's petrol engines are built in a Ford plant in South Wales, supporting hundreds of jobs there. Diesel engines come from Ford's factory in Dagenham, east London.

One of the sources knocked down reports on Indian television earlier on Tuesday that the deal had been closed for $2.65 billion.

"That figure of $2.65 billion is highly unlikely," one source close to the deal said of the report on news channel NDTV Profit. "You have to come south from that by quite a bit."

Ahead of the TV report, shares in Tata Motors rose 2.7 percent to a three-week closing high of 679.95 rupees, in a Mumbai market that surged 6.1 percent.

Ford shares were down 0.2 percent at around $5.95 at 1813 GMT. (Additional reporting by Hiral Vora and Narayanan Somasundaram; Editing by John Mair/Rory Channing/David Cowell)


TOPICS: Business/Economy; Culture/Society; Extended News; Front Page News; News/Current Events; United Kingdom
KEYWORDS: automakers; automobile; ford; fordmotor; india; jaguar; tata
Navigation: use the links below to view more comments.
first 1-2021-4041-50 next last

1 posted on 03/25/2008 12:43:00 PM PDT by Red Badger
[ Post Reply | Private Reply | View Replies]

To: Red Badger

Ok Tata, let’s see how you are perceived compared to Ford.
It will take awhile but can they do any worse?


2 posted on 03/25/2008 12:46:16 PM PDT by Joe Boucher (An enemy of Islam)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Joe Boucher

Pot Metal Motors


3 posted on 03/25/2008 12:48:07 PM PDT by ffusco (Maecilius Fuscus,Governor of Longovicium , Manchester, England. 238-244 AD)
[ Post Reply | Private Reply | To 2 | View Replies]

To: Red Badger


Jaguar's passage to India



By Kim Murphy and Henry Chu
March 22, 2008

 

 

LONDON -- Inspector Morse tooled around Oxford in a Mark II. James Bond's archenemy, Zao, drove an XKR roadster, with an optional Gatling gun mounted behind the seats. When former British Prime Minister Tony Blair pulled out of 10 Downing Street for the last time last year, it was -- how else? -- in the back seat of a Jaguar.

There have been Lotuses and Triumphs, Aston Martins and MGs, but no vehicle has epitomized the once-legendary British motor industry like that most English of cars, the powerful, sultry Jaguar.

 

Except that, for the better part of 18 years, Jaguar has been owned by Ford Motor Co. of Detroit. And that the brand is about to be acquired by another vestige of Britain's long-ago colonies.

India's Tata Group, in fact, wants to take off Ford's hands not only Jaguar but Land Rover, the British matron of sport utility vehicles in which Queen Elizabeth II has been known to flog through the gardens behind Windsor Castle.

The importance of one of India's muscular conglomerates riding to the rescue of British legends -- and paying as much as $2 billion to do so -- isn't lost on either side of the ex-empire.

The Tata deal, which could be sealed next week, "has made us all proud," said Debashis Chakraborty, a government official in Kolkata, the onetime capital of the British Raj.

Neither Indians nor Brits have failed to appreciate the historical ironies involved. In Britain, though, the reaction has been more mixed, with optimism that Tata Chief Executive Ratan Tata will be able to help restore the brand to its former glory spiked with faint regret that it took an Indian giant to do the job.

"I think Sir William Lyons would be turning in his grave, quite frankly," said Barrie Birkin, a longtime Jaguar owner from Matlock, in the Derbyshire Dales, referring to the legendary co-founder of the company who presided over the marque's preeminence in world motor sports and luxury car design through 1972.

"I can't believe it, to tell you the truth," Birkin said. "But Tata's a guy whose made billions, and he must have some ideas to turn it around."

It probably helps the British attitude that Tata is no stranger to preserving British brands. The company owns Britain's biggest steel firm, Corus, which includes the former British Steel, as well as Tetley Tea, which British observers note with some satisfaction was not merged into Tata Tea, the largest tea manufacturer in India.

"The media like to call it the empire striking back. But I think there's more to it than that. There's a lot of evidence in international business research that companies will go to countries that are close to their own countries, close being defined broadly either in cultural terms or historical terms," said Ravi Ramamurti, director of the Center for Emerging Markets at Northeastern University.

. . . . .



More classically British

Tata would maintain British management teams and three existing production plants in Birmingham and Liverpool, as well as two engineering and design studios.

And both Jaguar and Land Rover could wind up a lot more classically British than they ever did under Ford.

"What attracted us was the fact that these are two iconic brands, global in nature and highly respected for their products," Ratan Tata said in an interview with Autocar magazine. "We believe it is the duty of whoever owns them to nurture the image, to retain their touch and feel, and not to tinker with them. They are British brands -- and they should remain British."

Tata could succeed where Ford faltered by concentrating less on volume and more on restoring Jaguar's allure as a car people spend the first part of their lives dreaming about owning and the rest of their lives paying for. A new XF typically costs upward of $49,000, and Jaguar's supercharged V8 coupe, the XK, can command more than $86,700.

Ford, Cooke said, "didn't have time to stand back and say, 'What's this wonderful beast we've got here?' Ford tried to milk the brand without putting the investment in."

Tata could help reverse Jaguar's flagging sales not only by taking the brand back upmarket, but also by exploring affluent new markets in Eastern Europe and Asia.

The Chinese, according to Cooke, will buy 10 million cars in 2010 and twice that in 2020, with many new buyers choosing mid-size and luxury models for their first cars. General Motors Corp. sold more Buicks in China last year than it did in the U.S. India is behind China but growing phenomenally.

As it is, Tata has a foothold in the automotive industry with the Indica, the second-best-selling car in India last year. This year, the company has introduced what is billed as the world's cheapest car: the Nano, a diminutive four-seater, also known as the People's Car, that will sell in the East only for the moment, for about $2,470. Tata is also the nation's largest truck maker.

The company's positive track record with British acquisitions were factors in the strong support for Tata's bid from British unions. The labor groups had frowned on competing bids from private equity funds, including one represented by former Ford CEO Jacques Nasser, "because of their record of slash and burn, of closing the plants and loading the companies with debt," said Dave Osborne, automotive national secretary for the British umbrella union Unite.

As markets grow in places like Russia and China, he said, Tata wouldn't rule out moving some manufacturing eastward, "but those would be in addition to the British plants, not as substitutes."

From Tata's side, access to British plants, engineering and supply networks will allow a company stuck in Nanos to shave years off its graduation into sedans.

"They're cutting down on that 10-to-15-year gap of their going forward," said Amit Kasat, an auto industry analyst with Motilal Oswal in Mumbai. "It's very much clear that they want to take the Tata brand globally. This is another step."

Capital reverses course

The soon-to-be-completed deal reflects another important reality of the relationship between Britain and its foreign colony: India is now the second-biggest source of foreign investment in Britain, at $104 billion a year.

 





Read more...
 

4 posted on 03/25/2008 12:52:01 PM PDT by CarrotAndStick (The articles posted by me needn't necessarily reflect my opinion.)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Red Badger
Ford sells Jaguar/Land Rover to India's Tata

I think it went to good Hands.


5 posted on 03/25/2008 12:53:46 PM PDT by modican
[ Post Reply | Private Reply | To 1 | View Replies]

To: anyone

Bummer. Just when I started to get used to the x-type’s resemblance to the Taurus.


6 posted on 03/25/2008 12:58:16 PM PDT by guido911 (Islamic terrorists are members of the "ROP", the "religion of pu*&ies")
[ Post Reply | Private Reply | To 5 | View Replies]

To: Red Badger

wow...that’s one way to get rid of marketing to gays/lesbians.
sell off the line you used, that started yourself on the road to perdition.


7 posted on 03/25/2008 1:11:21 PM PDT by stylin19a
[ Post Reply | Private Reply | To 1 | View Replies]

To: guido911

Anyone who thinks the x-type resembled a Taurus needs their eyes checked...


8 posted on 03/25/2008 1:12:20 PM PDT by eraser2005
[ Post Reply | Private Reply | To 6 | View Replies]

To: stylin19a

I think this will be a win for RR/Jag brands.


9 posted on 03/25/2008 1:13:15 PM PDT by catbertz
[ Post Reply | Private Reply | To 7 | View Replies]

To: Red Badger

I reserve judgment on this until I get a look at the new 2009 ‘Bodacious’ model from Tata Motors.


10 posted on 03/25/2008 1:14:41 PM PDT by mkjessup (This year's presidential choices: "Speak No Evil, See No Evil, and Evil")
[ Post Reply | Private Reply | To 1 | View Replies]

To: eraser2005

I was thinking of the 2003 or 2004 model. I must have misspoke or am sleep deprived.


11 posted on 03/25/2008 1:19:03 PM PDT by guido911 (Islamic terrorists are members of the "ROP", the "religion of pu*&ies")
[ Post Reply | Private Reply | To 8 | View Replies]

To: CarrotAndStick
Cooke said, "didn't have time to stand back and say, 'What's this wonderful beast we've got here?' Ford tried to milk the brand without putting the investment in."

Idiot. Ford put billions into Jag and finally have beautiful product. Their giving it away alost makes me want to cry.

12 posted on 03/25/2008 1:20:50 PM PDT by green iguana
[ Post Reply | Private Reply | To 4 | View Replies]

To: guido911

I think you mean the S-type. Nicest looking Taurus on the planet.


13 posted on 03/25/2008 1:21:24 PM PDT by green iguana
[ Post Reply | Private Reply | To 6 | View Replies]

To: green iguana

I have a new S type and don’t you dare say it looks like a Taurus! ;)


14 posted on 03/25/2008 1:22:43 PM PDT by sheana
[ Post Reply | Private Reply | To 13 | View Replies]

To: eraser2005; guido911
S-Type


15 posted on 03/25/2008 1:24:27 PM PDT by green iguana
[ Post Reply | Private Reply | To 8 | View Replies]

To: sheana

Ummm, ummm, ummm... sorry.

I did say “nicest looking”...


16 posted on 03/25/2008 1:25:59 PM PDT by green iguana
[ Post Reply | Private Reply | To 14 | View Replies]

To: Red Badger

Tata has a hundred or a thousand times the growth prospects of Ford and you won’t find too much gay oriented advertising.


17 posted on 03/25/2008 1:27:16 PM PDT by steve86 (Acerbic by nature, not nurture™)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Red Badger
Imagine selling off production lines to save a pension...

The deal will also see Ford pay about 300 million pounds ($598 million) into Jaguar and Land Rovers' pension funds, according to unions.

18 posted on 03/25/2008 1:28:41 PM PDT by Brian S. Fitzgerald ("We're going to drag that ship over the mountain.")
[ Post Reply | Private Reply | To 1 | View Replies]

To: sheana
I have a new S type and don’t you dare say it looks like a Taurus! ;)

Heck, no! It looks like a Grand Marquis!
19 posted on 03/25/2008 1:35:16 PM PDT by Dr. Sivana (Not a newbie, I just wanted a new screen name.)
[ Post Reply | Private Reply | To 14 | View Replies]

To: Red Badger

Ta Ta


20 posted on 03/25/2008 1:37:49 PM PDT by OrioleFan (Republicans believe every day is July 4th, but DemocRATs believe every day is April 15th. - Reagan)
[ Post Reply | Private Reply | To 1 | View Replies]


Navigation: use the links below to view more comments.
first 1-2021-4041-50 next last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson