The Financial Times first reported in early January that Ford was considering selling the Jaguar unit of the Ford Premier Auto Group, the Ford Company’s luxury division. Jaguar has been in the Ford stable since the 1980s, the same decade that Ford began to assemble the PAG.

Alan Mulally told the FT, “All good businesses continually review their portfolio, and we will continue to evaluate ours going forward.” Good plan Alan! With that statement Ford is on the right track. But then again this statement comes weeks after Ford announced that they were looking for buyers of the Aston Martin name, PAG’s ultra luxury supercar division. Oddly, Ford’ Don LeClair told the FT just days later that Jaguar was NOT for sale. Clearly, Ford needs to get the corporate message packaged cohesively.

And that leads use to wonder if Ford is really taking its own advice. In evaluating the reasons for the sale, it is of no doubt that Ford is looking to sell the now profitable Aston Martin because it needs cash flow. A sale would generate short-term cash flow. This much is true. Still, Ford needs to consider the long-term ramifications of this decision. Aston gives Ford some degree of legitimacy in international racing, and no doubt Aston Martin in far more profitable than it has been in the past.

Ford has done an excellent job of turning around Aston Martin, which made only 43 cars in 1993. 2006 resulted in over 5000 Aston Martin sales. This is much contrasted with Ford’s 1989 purchase of Jaguar. Jaguar has struggled since its inception, and has yet to make any money for the PAG. It does however represent a Ford’s prestige motorcar presence in the auto industry. It is the only luxury auto unit that Ford runs outside of the USA, and the only one which is known and respected worldwide.

Regardless of what happens to Aston Martin and Jaguar, you can bet that Ford’s PAG will attempt to keep Volvo and Land Rover, both of which are profitable, in its portfolio. As we have said before, a sale of Aston Martin is mistake, and as likely is a sale of Jaguar.

This entry was posted on Thursday, March 1st, 2007 at 9:59 pm and is filed under Aston Martin, Ford, Jaguar, Land Rover, Premier Auto Group, Volvo. You can follow any responses to this entry through the RSS 2.0 feed. This post was read by 565 people until now. You can leave a response, or trackback from your own site.