TStag
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Posts posted by TStag
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JLR is expanding like crazy fuelled by debt but covered by profit. And frankly it's working. They won't have to maintain the investment forever. This is what Fords US managment didn't understand but JLRs Indian management does. When TATA bought JLR KPMG advised on this strategy and by all accounts it paying off.
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Last year JLR banked about 2 billion USD on volumes of 370 000 units. Last quarter Ford banked 1.6 billion USD on much much greater volumes. Now bearing in mind their relative sizes Fords decision to sell JLR looks awful.
Ivke always said Allan Mullaly has done a good job overall at Ford. But selling JLR was a terrible idea.
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I don't need to tell you I was right you all know it now! Last 3 years JLR have banked about 4 billion GBP in profits, how much was the company sold for? Should have shut Lincoln and Mercury and invested the savings in JLR
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Lincoln now sell fewer cars than Land Rover in the US market. JLR sold over 5000 cars in the US last month which makes it half the size of Audi which is not growing as fast (Land Rover up by over 30%) with lots of new metal coming down the pipe. Ford should have kept JLR. They'd have even helped prop up Ford Europes numbers.
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Ford just had its most profitable year in over a decade.
Ford just had its most profitable year in over a decade.
Yes but what a bad decade and FOE is hardly making any money.
To answer JPD From what I've read JLR will begin making 4 cylinders first followed shortly after by 6 cylinders. As they don't sell many V8s I think they will buy them in. Talking to a JLR engineer the priority is the 4 cylinder because Ford aren't selling JLR as many as they need to satisfy demand. At the moment the RR range is getting all the 4 pots which is hurting Jags XF sales. As I understand it Jag delayed the XF Estate because of engine restrictions from Ford. Thats not official but it's the real motivation for the engine plant according to my source who manages a key aspect of engineering design at Jag
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Actually they've made over 320000 cars in the last 12 months not 200000. And the argument is as much about when Ford sold as it is should Ford have sold. Right now JLR makes more money that Ford Europe. Volume is greater for Ford Europe than the whole of JLR yet Ford Europe made a paltry 17 million pounds last year against JLRs 1.2 billion. Maybe Ford likes Fleet sales or something but it seems to put quantity before profit!
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Ford now has enough cash in reserve to buy J-LR twice over...and they have long term engine supply contracts
Really? So JLR aren't building a new engine plant in the UK at the i24 sight in Wolverhampton where they will replace most of the engines Ford supplies with an in house alternative? Oh and also not planning to buil one in India too?
Sorry JLRs value has gone from 2 billion to 14 billion dollars in the space of a couple of years. Alan Mullaly has robbed Fords shareholders of 12 billion and Tata now say they won't float because 14 billion is far lower than where their compentant management team see JLR in the next few years.
Time for Mullaly to admit he got this 12 billion times wrong!
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http://www.forbes.com/sites/kenrapoza/2012/04/18/for-tata-motors-jaguar-a-gold-mine/
Deal of the decade? They sure saw Ford coming!
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Agree on the face of it, it seemed like an odd decision.
However they chose to exhbit in India instead which is one of their fastest growing markets and a market where BMW recently said that they aren't worried about competition from Mercedes but were in fact more concerned by JLR's extremely strong growth there.
When you look at JLR's total sales in China, the UK and India you actually start to realise that the US will become only their 4th or 5th biggest market overall. Not because of declining sales in the US but because of stunning growth in those markets. Last year Land Rover alone sold about 40,000 cars in China, without a factory there and with massive import taxes to contend with! That's pretty dang impressive.
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Tata are going to spend no less than $2.5 billion per year over the next five years on J/LR product development programs,
you realise that J/LR will have to earn at least $600 million profit for every quarterly result for the next five years just to break even.
It's not 2.5 billion USD. I think you'll find it's nearer 1.8 billion USD. Given that they made almost that in profits last year on smaller volumes then I don't see a problem. And JLR won't have to make $600 million dollars profit each quarter because some of that investment will get paid back over a much longer period of time. E.g when building their new engine plant they can pay that investment off over a much longer period of time than 5 years.
Thank God TATA have long term strategic vision, recognising that JLR's profits growth is accelerating at a pace where they will soon catch the German car industry. Let's see what happens to profits when the Evoque sales start to count. 2.5 billion dollar profit next year up from 1.8 billion dollar 'ish this year? Poor Lincoln maybe Ford should sell that to TATA too.... but I'm not sure TATA would want to waste that much money trying to turn the sinking ship around.....
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Who cares about a 10% drop in Jag's mostly ageing model line up (XJ aside) when you have a 43% increase in Range Rover sales. A net 35% increase is more important. Should the price of oil go up then Jag will probably recover ground. The Evoque is already a huge sucess and those numbers aren't even in these figures.
I've always said Jag has problem's which it will take time to fix. But I've also always said that no one should care about that when Land Rover generates such big profits for it not to be a concern.
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Impressive:
Most of TATA Motor's profits come from JLR these days....
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To be fair I think the biggest thing Jaguar/ Land Rover has going for it now is it's UK management and it's Indian backers.
Would the X type and S type ever have been signed off with British management making the styling decisions? No. Ian Callum has already stated that the X type was pushed on Jaguar by Dearborn and it was actually largely styled in the US. It was the biggest disaster in Jag's corporate history. The last pre-Ford decision made was to build the F type, which was 'cancelled' by Ford only to turn up as the Aston Martin DB7. Oops.
The XF was a largely British led design signed off by Ford.... pattern?
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Hurrah a proper Jaguar that's not a Mondeo in drag. Tata sure know how to run a company and also generate lots of profit.
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I'm a bit surprised the world markets are so calm about Greece. If they default, it could well cause a second credit crunch as the banking system goes into shock. Spain, Ireland and Italy could also then get into trouble as all lending dries up causing a third banking crisis.
At this point we really need the richer Eurozone countries to bail out the poorer ones. It's no different to when Bush bailed out the US banks.... It's unpalatable but it must be done.
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And Ford is laughing all the way to the bank, 243,000 engine sales to J/LR last year,
guessing that Ford's profit is roughly, $2,000/ engine that's around $500 million
without owning Jaguar or Land Rover...and then there's Volvo engine sales..
J/LR wants to run off and build another engine plant because they were worried
that Ford couldn't supply another 10,000 engines/year,
I hope they get a Tata chocolate teapot I-4.
They are building 2 engines plants with capacity to make 1 million engines per year. I think they also plan to supply TATA.
That $500 million dollars will diminish over the next 5 years considerably.
JLR may be investing 1 billion a year or more in product. But they are still making profits of over 1 billion a year. All that tech and IPR will now be available to TATA group rather than Ford.
TATA sure know's how to run great brands.
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Re-affirmed today on Lincoln's facebook page: ALL new Lincolns will have 100% unique sheet metal. No one has said the latest new products like the updated MKZ and MKX are representative of what Lincoln's future will be. They are holdover products. Nothing more.
How much longer to wait? Well, the all-new MKZ and small CUV should be out sometime next year.
That's interesting, but as pointed out by a number of people on this forum that is a double edged sword.
On the one hand it means Lincoln as the potential to challenge with products that can be seen as more than a rebadged Ford. But the downside is that Lincoln will need to shift a lot more metal to justify the extra investment into sheet metal that Ford is making.
Lincoln only sells in a few markets at present. Ford need to ensure it can sell in more. As Lexus have found extra sales in Europe are tricky for a non Euro car maker and as Caddillac are finding sales in China aren't that easy to come by when facing down the big German 3.
Licoln surely have an uphill battle but if Ford are commited to dumping money into the project then it may work. Might take 10 years or so to really get anywhere by which time Ford may sell it to the Indian's.....
Personally I think Ford should focus on Ford and develop Mustang (which will sell in Europe). Then drop Lincoln.
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Make $1B, spend $8B. Doesn't sound like a recipe for success to me. In fact, it sounds like the same recipe Jaguar and Land Rover have been using for the past 2 decades.
Sorry but JLR is doing that well TATA are now following the strategy laid out by BMW. Namely expand the number of models you sell. A 1 billion pound profit is not to be sniffed out when they only make around a quarter of a million cars. What's Ford's profit to number of cars made ratio over the last 12 months?
And now JLR are planning their own engine plant Ford will start to get less and less money out of JLR for supplying components....
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http://blogs.birminghampost.net/business/2011/05/jlr-powers-ahead.html
No wonder they plan to spend 8 billion on new models. This car company is making loads of money under the inspired management of TATA. Spending 8 billion will make this company into the next BMW....
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Bottom10:
104) Suzuki Forenza/ Reno - 1
103) Bugatti Veyron - 1
102) Bentley Mulsanne - 5
101) Suzuki APV - 10
100) Suzuki XL7 - 13
99) Audi Q3 - 16
98) VW VolksBus - 17
97) Scania P-Series - 24
96) Scania Omni - 25
95) Suzuki Carry Van(Vietnam) - 37
Rest at the link:
Audi Q3 - 16? Eh? That can't be right...
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On their way. Takes time. Remember how long it took to make a Jag that would start in the rain?
What specifically have Lincoln got in the pipeline that's not a mildly restyled Ford? 'Cos realistically the reason Merc and BMW are over taking Lexus in the US is because the make better cars on bespoke platforms.
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If Ford is serious about Lincoln then it needs to be looking to spend the kind of money on all new products that BMW and co are investing. TATA has recognised the need at JLR and is pumping in 8 billion dollars over the next 5 years to back 40 new products. Now that might be considered radical if it wasn't for the fact that Audi and BMW are also planning significant investments.
Jag is turning up to the party in the next few years with the C-X75. What's Lincoln's halo car going to be? Where are all those new Lincoln products and bespoke technologies?
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I'm surprised New York has gambled on electric power and not gone for a hybrid. I wonder if they will look at battery changing stations?
Jaguar Land Rover April 2017 US sales up 35%
in Competing Products
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Sorry I just read the ridiculous comment by Richard Jensen that JLR doesn't self fund! Really so how come they are driving TATA Motors profits, they have started making their own engines (dumping Ford's) and now have a 6 billion pound war chest to fund further growth?
Seriously the decision to keep the lights on at Lincoln and sell JLR was very dumb especially when Ford had already funded the turnaround with the XF, XJ and top selling Evoque. I said at the time it was very very dumb and have been proven right. Range Rover was always Fords most profitable brand (by margin) and Ford Europe bosses were dead against the sale because they knew what a dumb move Ford USA was making.
To say JLR doesn't self fund is insulting to TATA motors who clearly made one of the best moves ever in buying JLR!
Seriously don't ever listen to Richard Jensen again when he gives business advice, its right up there with Donald Trump. Who by the way would be way richer now if he'd just invested his inherited wealth in a tracker fund.....