Moosetang

http://today.reuters.com/news/articl...TRS;&type=qcna

This one could be taken a few different ways:
1. Protecting LR. Were the Rover name to end up stamped on a bunch of Chinese or Korean B-cars it would hurt Land Rover's pedigree a bit, especially to people who wouldn't be able to see their divergent heritage. By buying back the name, Ford keeps LR out of the slums.
2. An alternative to Jaguar. Should Jaguar be sold as-is, Ford could use the Rover name to replace it in PAG with an all-new brand structure independant of Jag's problems.
3. A replacement for "volume" Jaguar. Jaguar's attempt to go down-market with the X-type was a huge flop, the overcapcity and cost associated with that flop continues to hurt Jaguar big time. But replacing the X-type Jag with a Rover-branded Sedan could work out better, as Rover doens't have to hit Jag's lofty lux/performance goals.

Personally I'm hoping for option 3. Even if all you do is re-skin the X-type as a Rover you're switching from a low-qaulity Jag to a very decent Rover. Sales success with such a car would alieviate the pain of that unused X-type capacity. And If the Sale of Aston Martin goes through, reviving Rover "underneath" Jaguar makes it easier for Jaguar to move up-market to compensate.

mustang_sallad

I totally agree with you on that one. Slot it in under Jaguar, especially for the sake of the X-type which i still think was a cool car, send the Jags upscale.
Some guy from Automotive News suggests using the Rover name as a luxury Mazda line Ã* la Acura. They tried that once with the Amanti name, gave up on that one, but I believe the Millenia survived as a regular but upscale Mazda. I dunno though... I think it'd be cooler to keep the british connection on this one.
Then again, maybe Ford has bigger things to worry about right now, and making a new brand isn't exactly downsizing to meet a lower market demand.

jsaylor

Actually the upscale Mazda brand was to be called Amati, not Amanti. And the Amati 500 did indeed become the Millenia.

As for Rover, IMO that brand makes much more sense as a way to allow Jaguar and Land Rover to share components with a larger, more mainstream brand without having to share parts with an American make like Ford than as a upscale mark for Mazda, which is the last thing Ford needs right now. In fact they could position it as though Rover was benefitting from Jaguar componentry and engineering (which it will be) aiding both Jaguar economically and revived Rover's image. The usage of Ford powertrains in Rover cars was pretty common-place so this too allows Ford to further share components with the Rover brand without taking a hit for doing so.

IMO it is also worth mentioning that the addition of Rover to the line would make it even easier to let Volvo, which would fetch a pretty tidy sum of money for Ford, go. Ford could pull in several billion for the sale of Volvo and Aston Martin while giving up little to nothing in the marketplace given proper execution with Lincoln, Jaguar, and Rover products....sounds like a plan to me.

IMO Volvo will be on the market very soon.

V10

Hate to tell you, but it's simply #1, protecting the value of the "Land Rover" name. Doing so would make Land Rover more valuable if Ford decides to sell it.

The probability of #3 is somewhere between slim and none. The last thing Ford needs is more brands, it can't make most of the brands it currently has profitable. Rover has ZERO brand equity in the US and not all that much in Europe these days. Trying to resurect the "Rover" brand would be a billion dollar fiasco.

If Ford sells Volvo they're fools. Volvo is the ONLY part of PAG that's turning a profit (AM might be profitable in the last couple years). Volvo platforms are the basis of a bunch of new Ford models, 500/Montego/MKS. I belive the S40 platform is also now shared with some international Ford cars.

jsaylor

I have no doubt protecting the equity of the LR name is the primary reason for the above, but I find the near term sale of LR unlikely unless Ford simply plans to unload PAG altogether. I'll explain why later.

I wouldn't say it is that slim...a bit unlikely maybe, but not all that far-fetched for several reasons. Fords largest, and possibly least recognized, branding problem IMO is that their brands overlap too much. Ford is consistently short-sheeting one brand or another in an attempt to not step on yet another brands toes. Developmentally speaking this is absolutely a nightmare and is no doubt responsible for a lot of the questionable decisions made recently. Rover would be less problematic in this respect than would most of Ford's foreign brands IMO since it is more of a niche player.

Also, considering the body of recently orphaned Rover afficianados and dealers short term demand for these cars, if executed properly, would probably be very good indeed. As some have suggested the X-Type, which made for a sub-par Jaguar, could make for a superb Rover if only slightly reworked. Add in a bespoke version of the Focus and/or Fiesta and you could have a small brand which costs very little to revive that could produce some serious near term sales and money for an ailing Jaguar. That has to be attractive to Ford in the short term. The fact that Rover could also offer major component sharing for Jaguar and Land Rover in the long term, avoiding the need for those brands to come to the continentals for these parts, also is likely attractive.

Ford is also absorbing no debt by taking on the Rover name, producing a possible outlet for a poorly branded if otherwise excellent model (X-Type) that is going to cost a lot of money to kill, inheriting an intact dealer network that has likely been lessened a bit since MG/Rover's demise (making it even more attractive), giving LR and Jaguar a British partner to share costs with in the future, as well as inheriting a small but loyal body of enthusiasts who would likely buy enough "Rovered" X-Types and Foci for the next few years to make this a pretty lucrative undertaking.

Will they do it? Maybe, maybe not. But an argumeny for it exists, absolutely.

Your reasoning as to why Ford should not sell Volvo is precisely why Ford should sell Volvo. Selling Jaguar and/or Land Rover right now would be disastrous. Ford would almost certainly have to give any purchaser a huge sum of money to take either brand and would no doubt have to realize a large amount of loss that they can hide/pad so long as they retain these brands. Realistically LR has several successful models now (RR Sport, LR3) and is probably getting pretty close to turning a tidy profit. In fact, they may already be doing just that in truth with the possibility that Ford is "giving" some of Jags huge loss to LR in order to make that brand look a little better fairly likely. Given this an argument for selling a profitable LR in the near future is there.....on the surface.

But even assuming that Ford is doing the above and reverses course to make LR more attractive, or that Land Rover is about to become profitable due to the new product, the brand will have only recently been profitable so the sum offered would still likely be very small or nothing given the risk the brand still represents. On the contrary Volvo, which has been consistantly profitable, could demand some serious money. Also, at this point Jaguar and Land Rover are absolutely tied together at the hip...seperating the two would be difficult in the extreme and might serve to kill Jaguar altogether. Volvo vould easily fetch several billion for Ford motor (I wouldn't be surprised if 10 billion could be had) while selling Jaguar and LR would likely cost Ford more than they would get for Volvo and AM together at this point. Not only is selling Jaguar/LR not attractive at this point, it almost certainly is not an option at all.

This really does not make much difference, and Volvo is easily less dependent upon Ford than Jag or LR is. In fact Ford has shared as much with brands they merely partnered on models with in the past, and none of these Volvos share a plant with their Ford counterparts (some of the partnered models, like the Villager, did) The S40 shared a platform with a Mitsubishi model before Ford came along, and will likely have to share a platform with something given Volvo's production numbers no matter who owns the brand assuming Ford sells it, so the superb C1 platform is likely a plus in this respect.

The 500, Montego, and upcoming MKS all ride on the outgoing S80 platform which Volvo is going to discontinue usage of in the relatively soon. And these too are built in a seperate factory and do not share drivelines with their Volvo-badged relatives. In fact of all Ford branded vehicles only the Ford Focus ST shares a motor with a Volvo model, which is a very low production model no less, with Volvo being almost completely independent in terms of engines from parent Ford otherwise. Realistically speaking at this point Ford and Volvo share almost nothing that Volvo did not partner on or outsource for before the Ford purchase.

The biggest sticking point which I can think of is Jaguars usage of the upcoming Volvo I-6, but this too is a relatively small issue. Jaguar is apparently getting their own version of this mill, likely built in it's own facility (with the exception of the upcoming LR2 that is, which also is not a major concern in itself) To put it in simplest terms every reason Ford gave for selling Aston Martin holds true for Volvo as well. Ford may keep Volvo, but given their current need for funds and their poor ability to borrow at the moment I would be very surprised if this occurs.

Moosetang

I agree with the vast majority of what you say, JS, with one modification. If the sale of AM goes through (and at a good sum), and Rover's given teh X-type line, I don't see Volvo being put on the block. Reasons being

1. With AM gone, Jaguar will most likely be moved up-market toward AMG/Porsche/Ferrari range to fill the high-end. Rover will occupy the entry-level, but it will have Zero mid-range offerings, and only one model (S-class) which it could absorb from Jag to fill that mainstream BMW/Audi/Merc/Lex/Inf segment. With Rover below and Jag above, Volvo's fleet looks like a sensible mid-range to compete with.

2. Ford's cash situation is not as dire as its overall financial situation. Gaining cash near-term at the expense of a single, ultra-lux marquee makes sense. Gaining cash near term at the expense of a volume brand with good prospects, cash flow, and much-coveted engineering would be a much more desperate play. Ford's close but they aren't there yet.

jsaylor

Actually, I agree with most all of what you say as well, with the exception of the above. Ford is currently in a bad way in terms of ability to borrow money. Without that ability they are forced to use hard assets to develop and execute any cars or plans they might have, which could easily cause a drain on those that would hinder the development and release of vital new product while doing further harm to the company financially.

Long term Ford has a lot of good product on the horizon with vehicles that appear to be as significant and as well executed as models like the Fusion and Mustang. Long term vehicles like the Edge, upcoming B car, and Fairlane give reason to believe that Fords long term plans are sound and well executed. Following up on vehciles like the current Fusion and Mustang are absolutely vital goals that cannot be hindered in any way.

Right now they simply need the means/funds to get there and without a pretty big cash infusion that could be a tricky proposition. It would certainly require further compromise from a company that currently needs to do anything but compromise. I think that the ability to fund projects short term is currently Ford's biggest hurdle by far.