1SICKLEX
08-14-07, 11:42 PM
http://www.msnbc.msn.com/id/20145762/page/2
By Roland Jones
Associate editor
MSNBC
Updated: 7:57 p.m. ET Aug 14, 2007
There’s nothing quite as sad as a great name gone bad. Jaguar once was counted among the very best in luxury vehicle nameplates, and its name was synonymous with quality and excellence.
But the Big Cat’s image has seriously eroded in recent years under the ownership of Ford, which acquired the British nameplate in 1989 and now is considering selling it.
When Ford reported gloomy July sales figures this month, it became clear just how far the tarnished Jaguar brand had fallen.
July was a terrible month for car sales industrywide, and particularly for Ford. All six of its vehicle brands saw monthly sales declines, but Jaguar took the biggest hit, with sales tumbling 43 percent to just 1,136 vehicles. Last year Jaguar's U.S. sales fell 30 percent.
What happened? Put simply, Jaguar hasn’t kept up with the times, particularly when it comes to style. Research shows Jaguar buyers are older than the average luxury car shopper. Jaguar is suffering from an aging audience, according to George Magliano, director of automotive industry research at Global Insight.
“I don’t think people under 60 are aware of the luster of the Jaguar brand name,” said Magliano. “This is a difficult market, and people don’t necessarily see the Jaguar brand as a luxury sports car any more. And over the last decade the product just hasn’t been there to grab the American consumer.”
Jaguar, which traces its history to 1922, once stood for everything that’s best about automobile manufacturing — outstanding design, engineering and performance. The Jaguar E-Type, probably the most famous Jag of all, revolutionized sports car design in the 1960s and became an icon of that decade.
Now the posh British carmaker stands for everything that’s wrong at Ford. Despite billions in investment, Jaguar hasn’t turned a profit since Ford bought it in 1989 with plans to bring the brand to a broader market and challenge the likes of BMW. A series of poor business decisions, fierce competition and declining interest on the part of U.S. buyers meant this never came to pass.
Now Ford finds itself fighting bigger problems at home, including a whopping $12.7 billion in losses last year and needs cash as it pushes ahead with restructuring. Worldwide sales are dwindling, and Ford, which sold its Aston Martin brand in March, has indicated it would like to also sell the other nameplates in its Premier Automotive Group — Jaguar, Land Rover and Volvo.
These brands still have some clout. Potential buyers have lined up, reportedly including India-based Tata Motors and a handful of British and U.S. private equity groups. Selling these top brands will add some much-needed capital to Ford’s balance sheet.
“If Ford is selling Jaguar it’s because they know they won’t be able to put money into the brand to keep it relevant and updated, and that’s probably because Ford really needs to focus on its core product line right now,” said Jonathan Linkov, Consumer Reports’ managing editor for autos.
“Car consumers are fickle, so you really have to stand out with your design these days, and so I think correct way to look at Jaguar is as an example of a brand that has been ignored and not given the funding and support it needed because Ford has had other problems to deal with,” Linkov added. “When you’re relying on sales of big SUVs and pickups for your big profits the smaller brands are going to get lost in the shuffle.”
One of the reasons for the demise of Jaguar may have been a decision to reduce costs by sharing parts across brands, so that Jaguars are built using platforms on which other Ford vehicles are built, Linkov explained. The practice is common in the auto industry but in this case may have hurt the image or quality of the luxury brand.
Another reason for Jaguar’s fall from grace is styling. Ford has been criticized for letting the look of Jaguars age said Linkov. Jaguar’s flagship model, the XJ, which starts at just north of $64,000, has kept the classic Jag look from the 1950s and '60s until very recently, he said. That look might appeal to Jag aficionados, but not necessarily to a broader group of consumers.
In fact, Jaguar’s main models — including the X-Type midsize sedan, starting at about $35,000, and pricier S-Type sedans that sell for upward of $49,000 — have deviated little from the old-fashioned Jaguar look. Only the XK sports coupe has taken a new style path.
“The Jag was the luxury vehicle for kings and queens that the common person could still snap up,” Linkov said, but the hand-crafted interiors with “burl walnut” and “Peruvian boxwood” might not appeal to today’s buyers, he added.
The lower-end Jaguar models have faced tough competition from Audi’s A4, the BMW 3 Series and the Cadillac CTS, not to mention models from Acura and Lexus, said Linkov. And Jaguar has not always measured up, he said.
“When you’re competing with the A4 and BMW, you have to offer more than a leaping cat on a basic Ford,” he said. “People snap up A4s because they want the feel of driving a luxury car, but they don’t want to pay $60,000 for it. The basic Jaguar X-Type doesn’t do that. It’s just not the really well-rounded vehicle that those buyers expect. Also, in the U.S. Jaguars are smaller than the average sedan, and that’s not good because we like our cars to be big.”
“The XK convertible and coupe are nice vehicles and they have smooth engines, but they’re really more touring cars than sports cars” Linkov continued. “And they trail the Porsche 911 Carrera, which is the same price.”
Still, despite its troubles Jaguar likely will live on. One indication that Jaguar may be able to turn the corner, at least in terms of style, is the C-XF concept, which made its debut earlier this year at the Detroit auto show. The sedan indicates a bold new direction for the automaker, said Linkov.
“This is an exciting car, and it looks like all the money Ford has spent is actually going somewhere,” he said. “More importantly, the car looks refreshing to consumers, even if it’s the same old Jaguar underneath.”
© 2007 MSNBC Interactive
By Roland Jones
Associate editor
MSNBC
Updated: 7:57 p.m. ET Aug 14, 2007
There’s nothing quite as sad as a great name gone bad. Jaguar once was counted among the very best in luxury vehicle nameplates, and its name was synonymous with quality and excellence.
But the Big Cat’s image has seriously eroded in recent years under the ownership of Ford, which acquired the British nameplate in 1989 and now is considering selling it.
When Ford reported gloomy July sales figures this month, it became clear just how far the tarnished Jaguar brand had fallen.
July was a terrible month for car sales industrywide, and particularly for Ford. All six of its vehicle brands saw monthly sales declines, but Jaguar took the biggest hit, with sales tumbling 43 percent to just 1,136 vehicles. Last year Jaguar's U.S. sales fell 30 percent.
What happened? Put simply, Jaguar hasn’t kept up with the times, particularly when it comes to style. Research shows Jaguar buyers are older than the average luxury car shopper. Jaguar is suffering from an aging audience, according to George Magliano, director of automotive industry research at Global Insight.
“I don’t think people under 60 are aware of the luster of the Jaguar brand name,” said Magliano. “This is a difficult market, and people don’t necessarily see the Jaguar brand as a luxury sports car any more. And over the last decade the product just hasn’t been there to grab the American consumer.”
Jaguar, which traces its history to 1922, once stood for everything that’s best about automobile manufacturing — outstanding design, engineering and performance. The Jaguar E-Type, probably the most famous Jag of all, revolutionized sports car design in the 1960s and became an icon of that decade.
Now the posh British carmaker stands for everything that’s wrong at Ford. Despite billions in investment, Jaguar hasn’t turned a profit since Ford bought it in 1989 with plans to bring the brand to a broader market and challenge the likes of BMW. A series of poor business decisions, fierce competition and declining interest on the part of U.S. buyers meant this never came to pass.
Now Ford finds itself fighting bigger problems at home, including a whopping $12.7 billion in losses last year and needs cash as it pushes ahead with restructuring. Worldwide sales are dwindling, and Ford, which sold its Aston Martin brand in March, has indicated it would like to also sell the other nameplates in its Premier Automotive Group — Jaguar, Land Rover and Volvo.
These brands still have some clout. Potential buyers have lined up, reportedly including India-based Tata Motors and a handful of British and U.S. private equity groups. Selling these top brands will add some much-needed capital to Ford’s balance sheet.
“If Ford is selling Jaguar it’s because they know they won’t be able to put money into the brand to keep it relevant and updated, and that’s probably because Ford really needs to focus on its core product line right now,” said Jonathan Linkov, Consumer Reports’ managing editor for autos.
“Car consumers are fickle, so you really have to stand out with your design these days, and so I think correct way to look at Jaguar is as an example of a brand that has been ignored and not given the funding and support it needed because Ford has had other problems to deal with,” Linkov added. “When you’re relying on sales of big SUVs and pickups for your big profits the smaller brands are going to get lost in the shuffle.”
One of the reasons for the demise of Jaguar may have been a decision to reduce costs by sharing parts across brands, so that Jaguars are built using platforms on which other Ford vehicles are built, Linkov explained. The practice is common in the auto industry but in this case may have hurt the image or quality of the luxury brand.
Another reason for Jaguar’s fall from grace is styling. Ford has been criticized for letting the look of Jaguars age said Linkov. Jaguar’s flagship model, the XJ, which starts at just north of $64,000, has kept the classic Jag look from the 1950s and '60s until very recently, he said. That look might appeal to Jag aficionados, but not necessarily to a broader group of consumers.
In fact, Jaguar’s main models — including the X-Type midsize sedan, starting at about $35,000, and pricier S-Type sedans that sell for upward of $49,000 — have deviated little from the old-fashioned Jaguar look. Only the XK sports coupe has taken a new style path.
“The Jag was the luxury vehicle for kings and queens that the common person could still snap up,” Linkov said, but the hand-crafted interiors with “burl walnut” and “Peruvian boxwood” might not appeal to today’s buyers, he added.
The lower-end Jaguar models have faced tough competition from Audi’s A4, the BMW 3 Series and the Cadillac CTS, not to mention models from Acura and Lexus, said Linkov. And Jaguar has not always measured up, he said.
“When you’re competing with the A4 and BMW, you have to offer more than a leaping cat on a basic Ford,” he said. “People snap up A4s because they want the feel of driving a luxury car, but they don’t want to pay $60,000 for it. The basic Jaguar X-Type doesn’t do that. It’s just not the really well-rounded vehicle that those buyers expect. Also, in the U.S. Jaguars are smaller than the average sedan, and that’s not good because we like our cars to be big.”
“The XK convertible and coupe are nice vehicles and they have smooth engines, but they’re really more touring cars than sports cars” Linkov continued. “And they trail the Porsche 911 Carrera, which is the same price.”
Still, despite its troubles Jaguar likely will live on. One indication that Jaguar may be able to turn the corner, at least in terms of style, is the C-XF concept, which made its debut earlier this year at the Detroit auto show. The sedan indicates a bold new direction for the automaker, said Linkov.
“This is an exciting car, and it looks like all the money Ford has spent is actually going somewhere,” he said. “More importantly, the car looks refreshing to consumers, even if it’s the same old Jaguar underneath.”
© 2007 MSNBC Interactive