Last leg? Jaguar loses $715 million in 2006
We all know that Ford doesn't break down the earnings (or losses) of its Premier Automotive Group, which includes Jaguar, Volvo, Land Rover and Aston Martin. Nevertheless, the Detroit News has learned just how much of an anchor the Jaguar brand was on the group's bottom line last year. In 2006 the Jaguar brand lost $715 million. DTN also uncovered an internal memo to executives that projects the brand will lose $550 million in 2007 and another $300 million in 2008. Clearly a quick turnaround is not in the cards for Jaguar, an asset into which Ford has dumped billions and billions of dollars since its purchase back in 1989.
[Source: The Detroit News]
Of course, Jag execs sound upbeat, trumpeting the postiive reception of the XK and XKR sport coupes, as well as the C-XF concept that debuted in Detroit. In fact, Bibiano Boerio, the managing director of Jaguar Cars, told the Detroit News that her brand's slumping sales are a good thing. Her reasoning? Lower sales allows the brand to return to its roots of building higher priced niche vehicles in lower volumes. OK. Presumably the upcoming XF that's set to replace the S-Type will be the first model charged with restoring the brand's luster and attracting bigger wallets into showrooms. Though the X-Type will not be cancelled altogether, it will make way in Jaguar's biggest markets, Germany, Japan and the U.S., for the XF to become the new, much more expensive entry model.
But seriously, how determined can Ford be to turn itself around when it insists on maintaining a brand that will lose untold millions over the next three years? In a perfect world, it would be great if a buyer came along for Aston Martin and allowed Jaguar to comfortably move upmarket, but Ford's out of time on this one. It's time to drown the cat and take its ninth life.
Reader Comments (Page 1 of 1)
Jscro 4:48PM (1/24/2007)
They have some beautiful vehicles coming out in the next few years, I hope they can stay afloat. Ford diluting the brand with the awful X-type was a terrible move.
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bmw122487 4:55PM (1/24/2007)
First of all i should make it clear that i don't like ford at all and that i generally only buy cars from BMW and General Motors. That said i an deeply in love with the brand new XK and for some reason the current XJR is one of my favorite cars of all time and i would gladley choose it over a mercedes or audi, even a BMW 7 with its bangle ass. Jaguars were beautiful and prized once and think can be again. So i at least would be heart broken if the Cat dies. FORD please don't kill the only cars i like of yours, please!!
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chuck goolsbee 5:13PM (1/24/2007)
The Jaguar of today is merely a walking corpse. A zombie as it were.
Jaguar stopped being Jaguar when Sir William Lyons retired in '72, and in all respects Jaguar died with Lyons in 1985.
http://www.brophy.com/eodweb/htmls/designers/hd92_1.htm
The only shred of a "real" Jaguar left (besides the priceless treasures of the Jaguar-Daimler Heritage Trust!) in existence are a few styling cues evident on the XJ sedans. In reality they are all just tarted up Fords, and a black mark on the fine marques name.
--chuck
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Richard Warren 6:00PM (1/24/2007)
#3 101% correct.
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Chris 6:07PM (1/24/2007)
Well, I have an XJR and it's great. I think that Ford would do well to sell Jaguar. Sir Anthony Bamford has already stated he would buy it.
The real problem is that Jaguar's brand image and their cars don't line up. A lot of people I know were pretty shocked when I bought the Jag (supposedly, as a mid-thirties person, I'm too young for a Jag...). To be successful, they really need to have an overhaul like Bentley has had, with epic design and power.
Grace, space and pace - that's how Sir Lyons defined Jaguar. For the last 15 years, they've had a lot of the first in both the XJ and the XK, but not much of the later two. The S-type was largely the right move, but the X-type took them very far away from that moto.
Going back to that essential philosophy is the thing that will save Jaguar.
Chris.
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Tiago do Vale 6:29PM (1/24/2007)
I'm glad they are selling the profit making Aston Martin, and keeping the loss making Jaguar...
Probably the Ford group should just sell Ford and it's administration.
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Juan Jose Gaitan 7:06PM (1/24/2007)
What Jaguar is missing is a SUV that can be based on the Land Rover platforms....don't you think so?
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Mike G 10:25PM (1/24/2007)
Wow that new Jaguar XK with the sad puppy dog eyes must really be lighting up the sales charts, eh? With Jaguar losing so much on their ugly new models maybe they'll have to go back to good looking design again.
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minh 7:04PM (1/25/2007)
jaguar is doing bad because the xk is ridiculously expensive! if the xf-c is sold at a reasonable price, it will stand a fighting chance
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Justin 8:56AM (1/25/2007)
Wow #7 sounds just like an auto-exec. The LAST thing they need is an SUV...in fact the last thing anyone needs is a Jag SUV. Luxury marques making SUVs is the most worthless endeavor/trend the auto industry has been following lately.
Jag needs to start making NEW looking cars, not ones based on designs from 30 years ago. And they need to regain their brand loyalty and reliability. Jag is a shadow of it's former self.
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JarryHames 11:19AM (1/25/2007)
I still think that Jag can rise again. Ford just needs to stop burning money and go back to the basics. They need to make some solid sedans that are modern classics with solid performance. Don't mention a Jag SUV! Ford will make one in a minute. That's why they're not selling anything at the moment. They've focused too heavily on nothing but SUVs.
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dsykes1717 12:57PM (1/26/2007)
The problem is not Ford, the problem is Jaguar. They spent 40 years tarninshing their own image by making cars with poor reliability and whose performance was steadily falling behind that of its competitors. The niche that Jaguar filled can be summed up by saying "yes she breaks but boy is she beautiful." Even Ferrrari has had to largely put that nonesense to bed. The company lacked the funds to invest in new products and consequently missed the mass-tige trend that BMW, Lexus and Mercedes have ridden to success in the United States. Ford has made many of those investments, but it takes time (and consequently money) to rebuild and reshape a brand.
That is not to say that Ford has not made mistakes, but its biggest mistake is conceptual - that it could turn what was essentially a niche-market british marque with a good number of die-hard fans into a large luxury car manufacturer overnight with pieces that it had on hand (It also did not help that Ford's stylists stole Jaguar design cues and inserted them to varied success onto its own cars and eliminating some of the appeal of the "special-ness" on which mass-tige is built). But credit should be given where it is due and Ford is making better Jaguars than Jaguar themselves did through the most of the seventies and all of the eighties. And Jaguar would probably not be here at all were it not for Ford.
Further, we are framing the debate about Jaguar's fate incorrectly by discussing only the amount of money that Ford is losing. Selling Jaguar would mean that Ford is effectively abandoning the top-end luxury market (and its high margins and technological development benefits) all together. No one is buying Lincoln cars but limo companies and Ford will have a hell of time moving Lincoln up-market no matter how good the product. Volvo is not really a luxury car company and would have trouble competing with BMW, Lexus and Audi at their flagship level. If Ford wants a piece of this market, Jaguar is the ticket. Besides, there is nothing wrong with Jaguar that a cycle or two of stellar product won't fix. We know Ford is capable, they just have to step it up.
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Q 10:51AM (1/29/2007)
Dsykes - you nailed it.
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