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Jaguar and Land Rover Sold to TataFord Sells British Luxury Car Brands in US$2.3 Billion DealThe all-cash sale of two luxury car brands Jaguar and Land Rover by Ford Motor Company to Tata Motors, announced 26 March 2008, was formally completed today in the UK.
The year 2008 is providing significant landmarks for Tata, India’s main vehicle manufacturer. On January 10, 2008 The Nano was launched at the Delhi Auto Expo as The “People’s Car”. With a top speed of 65 mph, seating for 4/5 persons and just 3 metres long, the Nano retails at 100,000 rupees or around 2,360 Canadian dollars. Then on March 26, 2008 after 9 known months of negotiations with Ford Motor Company, it was announced that Jaguar Land Rover would be sold to Tata Motors. Tata’s Acquisition of Jaguar Land RoverTata’s acquisition of Jaguar Land Rover today was marked in a handing over ceremony in the United Kingdom at Gaydon, the Jaguar Land Rover headquarters. Commenting on the occasion, Mr. Ratan N. Tata, Chairman of Tata Sons and Tata Motors said, “This is a momentous time for all of us at Tata Motors. Jaguar and Land Rover are two iconic British brands with worldwide growth prospects. We are looking forward to extending our full support to the Jaguar Land Rover team to realise their competitive potential. Jaguar Land Rover will retain their distinctive identities and continue to pursue their respective business plans as before. We recognise the significant improvement in the performance of the two brands and look forward to this trend continuing in the coming years. It is our intention to work closely to support the Jaguar Land Rover team in building the success and preeminence of the two brands.” Reported annual revenue of Tata, the world’s fourth largest truck manufacturer and the second largest bus manufacturer, was US$ 8.8. billion in 2007-2008. Tata Motors confirmed that Mr. David Smith, who became acting Chief Executive Officer after the death of Geoff Polites, would be the new CEO of the business. About 16,000 staff were employed by Ford Motor Company, based at plants in Solihull and Castle Bromwich West Midlands and Halewood Merseyside England, involved in the manufacture of Jaguar and Land Rover vehicles. BBC News (2 June 2008) reports that local city council, union officials and business leaders have endorsed the Tata deal for Jaguar Land Rover. With the unveiling of The Nano earlier in 2008 and the confidence to acquire Jaguar and Land Rover, Tata Motors is considered a vehicle manufacturer on a clearly upward trajectory. About the Deal for Jaguar Land RoverLast year Ford sold the asset Aston Martin in a move to improve its financial performance and announced its desire to sell Jaguar Land Rover as a package. In the cash free, debt-free sale costing US $2.3 billion, Tata Motors has acquired two British brands of luxury cars – Jaguar and Land Rover with distinct historical profiles of buyer. Ford bought Land Rover from BMW in a US $2 billion deal in 2000. Land Rover, including its sequence of Freelander and Defender new models, has performed well within the Premier Automotive Group (PAG), the Ford divisions alongside Volvo, Jaguar and Aston Martin. Analysts have reported in the Financial Times that Ford has gained little to no profit from Jaguar which was acquired in 1990 for $2.5 billion. James Dolan reported in ‘Jaguar’s future in the balance as Ford reviews its weakest assets’ in The Times (August 3, 2006) that “Bill Ford announces the “Way Forward” restructuring for North America, involving the closure of 14 factories and up to 30,000 job cuts”. Business analysts agree, that following Tata’s acquisition of Jaguar Land Rover, Ford will be able to focus on a two year expected turnaround of its core car business in North America.
The copyright of the article Jaguar and Land Rover Sold to Tata in Car Manufacturers is owned by Susan Morris. Permission to republish Jaguar and Land Rover Sold to Tata in print or online must be granted by the author in writing.
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