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Saturday, December 24, 2005

Ford Flushes More Money

I hope Ford knows what it is doing with Jaguar. Reuters reports that they are sending another $2 billion to Jag, which has not ever, as far as I know, actually made money for Ford. Jaguar has turned out to be quite an albatross.

As I have written before, I think that Ford made a big mistake buying Jaguar (and Land Rover). Jaguar has a distinct style and heritage, so brand identity is not really a problem, except for the disastrous down-market X-Type. The big question is, do consumers really want "British luxury", in the form of softly sprung powerful cars? The competition in the sport/luxury market is very tough, with Mercedes, BMW, Porsche, and Audi on the German front; Lexus, Infiniti, and Acura on the Japanese front; and Cadillac at home. Lincoln, unfortunately, is not much of a player.

What kind of great stuff could Ford have done with Lincoln, if it had invested the billions of dollars it used to buy and then (repeatedly) bail out Jaguar? Could Ford have done a Cadillac style transformation with Lincoln, moving it credibly up-market, and into a fuller line of vehicles?

Ford should sell Jaguar and Land Rover to the highest bidder, or spin them off as an independent company (how about "BMC"?).

2 comments:

Anonymous said...

As for why Ford would be so foolish, I have no idea. They should have learned from the past - the British taxpayers tossed away tons of money over decades, carrying Jaguar.

Having something "covetable" such as Jaguar's olde tyme Walnut veneer, Connolly leather and Wilton carpet as well as "the Jag look" and snarling DOHC sixes does NOT translate into profitability.

Ford should sell it off and run, not walk, away. Land Rover, too.

Glenn A.

Unknown said...

Re: "Could Ford have done a Cadillac style transformation with Lincoln,"

Good question. I thought the LS was a decent start - it's the only Lincoln I could ever have imagined buying. Not sure about the build quality though.