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loather March 26, 2008 11:40 AM

Have you been at the Tetleys? - and I don't mean tea.

"Super profitable[LR]"!? Care to state figures? In profit per unit? In comparison to Toyota, Porsche, BMW, VW?

"Jag is on the brink of a bounce"!? That'll be a 'dead-cat' bounce then. Circa 2002, 'full-line' production objective 200,000+ p.a.; 2008 reality sub 50,000. The only way is up, no/yes?

No mention Chas of reports two weeks ago in the Indian press of Tata 'flipping' Jag then - shuffling off Jag at first opportunity to concentrate on LR? (will provide web link if interested); or similarly Tata's plans for a large new plant outside of Delhi to build LRs? Solihull redevelopment anyone?

I wouldn't be at all sure of JLR's future, full stop. the only sure fire winner out of this 'episode' will be Lord Professor Bhattacharrya's Manufacturing Group at Warwick, who personally lobbied hard for his mate Ratan (Tata)'s takeover and for UK govt. to spend £40m on car-related future technologies - Now I wonder who/where is in line to get the bulk of that 40 million squids? Not the Lord enobled by Nu Labour? Surely not!

JJBoxster March 26, 2008 2:18 PM

Loather - You've got an unfailin accuracy in your posts that I like.. alot :-)

'Dead cat bounce' just about sums up Jaguar at the moment. The 'fishy' smells from this deal (if I was a Ford shareholder I'd have Private Eyes into possible Ford family corruption over this deal) doesn't end with the deal. It starts with why Jaguar built such good cars (JD Power toppers) and did everything right but clothed the cars in stupid unpopular designs.

All it takes is Tata doing a simple, easy restyling job to have these models right back up the sales chart. Why did Ford get it so right with modern plant, great cars but so deliberately wrong with the design?  

analyst March 26, 2008 4:02 PM

Loather,  LR profit margin per unit in 07 was $5300, second to Porsche but ahead of Lexus in third.  BMW at $4000 was 4th, VW and Toyota were miles behind.

It's all in the public domain if you look.  The livemint.com report (link below) gets it almost right but underestimated the LR profit at $1bn when it was in fact $1.2bn.

www.livemint.com/.../Ford-may-be-better-off-selling.html

loather March 26, 2008 5:09 PM

'analyst' March 26, 2008 4:02 PM

thanks for the link - interesting.

You've got me looking into this now, but a quick couple of responses:

- fifty-three hundred dollars sounds good but latest Porsche profit per vehicle for last six month period works out at $43,000(on net income). Granted, a large share of this, as it says in the Bloomberg report, comes from the VW share holding and extraordinary hedging transactions. Would suggest actual Porsche core operating figure about half or less of that at circa $20,000.

www.bloomberg.com/.../news

- "The fourth quarter was tough for PAG, with profits shrinking to $59 million from $174 million in 2006 as adverse currency exchange rates and product mix hit Volvo.

In the fourth quarter, Volvo broke even, while the combined Jaguar and Land Rover operations were profitable.

PAG revenue for the quarter was $9 billion, up from $8.6 billion in 2006." Automotive News Europe

forums.mg-rover.org/showthread.php

So if Volvo was neutral in the $59m Q4 2007 PAG profits, and we take the preceeding $5,000 or so per unit from Land Rover as contributing on approx. 55,000 vehicles, that means $275 million or so from LR and hence $200 million plus loss from Jaguar. That on sales of about 50,000/4=12,500; that's $22,000 loss per vehicle! Either Jaguar's dramatically loss-making or LR's 2007 Q4 profits took a dive. Would suggest that more likely to be the former, which would explain why has been suggested Tata would be keen to sell-on Jag at first opportunity - the Fiat link up on high-end rear-wheel drive platforms for Alfa Romeo and Lancia?