The speculation and waiting is finally over as Ford is set to officially announce the sale of Jaguar and Land Rover to the Indian motor company Tata. Despite reports of a higher closing bid, as high as $2.65 billion, the final closing amount to be paid by Tata has been revealed by Ford at $2.3 billion.
The news was released Tuesday afternoon on the news wire, but Ford wished to wait until Wednesday morning to make their statement to the public. That was to give them at least a day to break the news to all their employees who may not have access to a radio, TV or the internet.
While some analysts and bloggers express concern for the future of the Jaguar and Land Rover brands under Tata, the sale will surely prove another step toward someday finding the books in the black for Ford. The empire building performed by Ford and GM done in the 90’s and early 2000’s have proven to be too costly and not nearly as profitable as they had hoped. With the conclusion of this sale by Ford there will only remain Mazda and Volvo tagging along with the Ford/Lincoln/Mercury brands.
Tata is a builder of small passenger cars and heavy duty trucks, and happens to be the largest automotive company in India. They have been looking for ways to expand their company outside of their country and may be eyeing Jaguar and Land Rover for that purpose. Their want for Land Rover would also give them the luxury SUV’s to go along with their trucks and that may be an easier marriage into the brand than Jaguar. There are many that worry about Tata’s vision for Jaguar and that the British coach builder might suffer as being forced into the sale as a package deal.
However, all ties to Ford will not be severed in the deal. Ford has agreed, much to their benefit, to continue building the engines for both Jaguar and Land Rover from their engine plants in the UK. Ford has also agreed in the buyout to inject $598 million into the pension fund of the two companies… is that considered a parting gift?
In the end the stress of running Ford will have gotten a little lighter at the conclusion of the sale to Tata, and some people’s A-Plan purchasing options just got a little smaller. As for Jaguar and Land Rover’s future… only time will tell.