In the surprise of surprises, Ford CFO Don LeClair has come out to say that Ford's PAG luxury group will be PROFITABLE in 2007. PAG, which lost $327 Million in 2006 and $1.15 Billion over the past three years, has been consistantly weighed down by Jaguar (though many other brands in the group have also operated in the red, as well), which has averaged somewhere between $500 Million and $1 Billion in losses per year since 2001. Another bummer for PAG has been the high value of the Euro and Pound against the Dollar. It hasn't affected BMW or Mercedes as much, in part because their product lineups and brand strengths are better, but also because they build some of their vehicles, including the 3 Series, in the USA.
In the past, Volvo has been Ford's savior, earning between $800 Million and $1.2 Billion per year. A stale product lineup has slowed sales here in the US for 2006, which contributed to the $327 Million overall loss for '06. The all-new S80 and C30 should help the Swedish semi-luxury brand to recapture those lost buyers. Also helping matters will be the eventual sale of Aston Martin for over $1 Billion (though it won't be counted as profit for PAG) and the slim profitability of Land Rover.
We'll see if this news comes to fruition, as 2007 just began and there's a long way to go to the finish line in December.
[Source: Automotive News - sub. req'd]