Ford offloading upscale brands
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Manufacturing News, Source : The Manufacturer US
Published : 13 Jun 2007 21:56
Ford has decided that its Premier Automotive Group (PAG) of luxury brands too expensive to own.
After selling its Aston Martin line in March, the company is now considering selling its Jaguar and Land Rover brands, leaving Volvo its only remaining European brand.
After losses of about $13 billion in 2006, Ford with its "Way Forward" plan has pledged to be profitable by 2009. (Forbes describes the Way Forward as a "no frills ride" as PAG shrinks.) The PAG accounted for about $2.3 of those $13 billion lost in 2006.
The Economist is reporting that Fiat and Renault are interested in the brands. Ford bought Jaguar in 1989 for $2.5 billion, but never managed to remarket the brand (seen as somewhat stuffy) to younger, affluent drivers. As Forbes describes, acquisition is a difficult way to go upscale. Toyota built its Lexus brand from the ground up, including the Lexus image, while Ford found rebranding Jaguar hard going. Meanwhile, Ford's own luxury brand, Lincoln, withered from neglect.
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