By on March 4, 2008

2008011154530101.jpgAs we reported yesterday, Ford's sale of Jaguar and Land Rover to India's Tata Motors is far from a done deal. In light of today's confirmation that the transaction will not go through this week as predicted, it looks like Tata's reach may exceed its grasp. Reuters questions the role the British brands would play amongst Tata's lineup of commercial-duty trucks and compact to sub-compact cars. Another issue: Tata's credit rating. It turns out that Moody's and Standard and Poor's placed Tata on review for a credit rating downgrade when the Indian firm emerged as the frontrunner for Jag/Landie. Not coincidentally, Tata's stock slid ten percent during its six month courtship of Ford's cast-offs, while the rest of the Indian stock index grew by nine percent. Speaking in Geneva, Rattan Tata was quoted as saying he remains "reasonably confident" that the deal will go through. Reasonably? Uh-oh.

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12 Comments on “Tata Purchase of Jaguar and Land Rover In Doubt...”


  • avatar
    Bancho

    If a deal looks like crap, and smells like crap…

  • avatar
    frontline

    Was there any truth in Tata selling off Jaguar as soon as they settled?

  • avatar
    Stephan Wilkinson

    He also said that if they acquire the two brands, they “have no intention of meddling with them in any way,” which is right up there with “I promise to pull out before I come.”

  • avatar

    If the deal doesn’t go through with Tata who else would be a buyer?

  • avatar
    windswords

    Wasn’t there someone who used to post that Tata’s market capitalization exceeded GM’s? Well, maybe they’re richer on paper…

  • avatar
    KatiePuckrik

    Ford are grade A spanners! Sir Anthony Bamford made an offer to buy Jaguar (and explicitly said that he didn’t want Land Rover) and Ford never followed it up.

    Everyone would have won. Ford gets shot of Jaguar and keeps cash cow Land Rover, Jagaur gets a owner who can give the one thing Jaguar has been lacking (passion) and the UK would no longer have to be subject to the jokes of not having a car industry*!

    * = Not strictly true, we’ve got Aston Martin back! :O)

  • avatar
    jthorner

    Contrary to what many say, globalization is neither a historical imperative nor is it always a good thing.

    Culture, point of view and national flavor do indeed matter. Jaguar and Land Rover need to be owned and staffed by Brits in order for there to be real “brand DNA”.

    Volvo likewise should be an actual honest to goodness Swedish company and should offer the market an honest to goodness Swedish interpretation of the automobile.

    The notion that anyone can own anything and still maintain the philosophical integrity of the brand is rubbish. Look what happened when the Germans tried to run Chrysler!

    Contrary to popular opinion, Mazda is not thriving under Ford ownership but is simply continuing to exist.

    Jaguar can no more be managed by Indians (or Americans) than VW could be managed by Brazilians … and VW has a long history of manufacturing in Brazil.

    Now with global financial markets in near meltdown I wonder if any of the UK groups who were bidding for Jag/LR can still get the money together? If a new auction is held today the price is almost certain to come down from the Ford-Tata deal as the auto business and world economy have deteriorated even more since that deal was made.

  • avatar

    KatiePuckrik: who owns Aston? Last time I checked it was owned by a group of Middle Eastern financiers.

  • avatar
    KatiePuckrik

    Mr Mehta, Prodrive own Aston Martin who used Middle Eastern financiers, but they have no say in how the company is run.

    And I would be careful about using that as a metric for what country owns what. Because GM and Ford are traded on the stock market which means, by your logic, GM and Ford aren’t American but owned by many countries.

    According to Carlos Ghosn’s book, Nissan is 44.4% owned by Renault (who subsequently own 15% of Renault), 6% by japanese companies and the rest are private pension firms. So, therefore, pension firms can make good cars…..

  • avatar

    Though I do agree with you, I know people who don’t want an Aston because of the new owners, sad as that sounds. I expect they’ll be happy with an SL, even without any of that Aston craftsmanship or exclusivity.

    One thing I gotta add is that investors/VCs always have a “say,” and they’ll use it if the figures don’t add up on the balance sheet. Whether they publicly admit that is irrelevant.

  • avatar

    I suspect that the Indian firm would want to ship production to there own Country for these two vehicles, and I guess the “thorn” in the side would be the workers in England and there Union, its will be hard to move work to India I would think!

  • avatar
    LDMAN1

    jthorner :”Jaguar and Land Rover need to be owned and staffed by Brits in order for there to be real “brand DNA”.

    DNA?! Inbreeding leads to genetic defects.

    Today, Land Rover owes its profitability to the Germans. L322 (New Range Rover) is a BMW product. The Germans reinvented the Brand away from Range Rover P38., NOT the Brits. Yes, BMW did rip off off-road technology in the process.

    Jaguar is nearly dead today because for years it was mainly staffed by Brits who sold cars designed solely by and for the Midlands, in North-America, mainly to their aging customer base. The nail in the coffin for Jag was spending a cool $1 Billion on X350 (New XJ) and making it look exactly like X300 (Old XJ) in order not to upset its British/WASP Customer base.

    As for Jaguar Brand DNA one word would suffice to illustrate my point: “Gorgeous.”
    Incest has given Jaguar enough recessive genes for the next 50 generations.


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