Jaguar: life after Ford

Opinion

When proud British institutions Jaguar and Land Rover were sold by American car giant Ford to Indian company Tata in 2008 it didn't take long for unsavoury jokes to do the industry email rounds. One of the least tasteful emails depicted a Jaguar with the 'leaper' mascot replaced by an elephant's trunk.

The late Geoff Polites, the then boss of Jaguar and Land Rover, took such offence to one such email forwarded to him by a journalist that he delivered him an almighty rocket from the other side of the planet. I'm still not sure if the vapour trail has evaporated into the atmosphere. And that journalist [Ed: not the writer] was just the messenger, not the originator of the offending material.

Now three years on, it seems clearer that it will be Jaguar that has the last laugh.

Polites would today be proud of the reborn company he left behind. As much as the Aussie was loyal to his lifelong career with the Blue Oval, the new owner Ratan Tata appears to have unearthed a lot of pent up frustration – and talent – among Jaguar employees.

Admittedly the company is not completely out of the woods but the early signs are good.

The Jaguar Land Rover group has emerged from the Global Financial Crisis relatively unscathed. After Jaguar reportedly never made a profit under Ford's ownership from 1989 to 2008, the new company just reported a profit of $US1 billion and good cash reserves. Though these will no doubt erode quickly as it re-invests in a raft of new models over the next five years.

Most of Jaguar's and Land Rover's line-up will be replaced or heavily overhauled in the near term, but if the updated XF sedan range, facelifted XK coupe line-up and all-new XKR-S super-coupe (pictured) are a guide, the future is bright.

After almost two decades of Ford bureaucracy, Tata is giving Jaguar designers, engineers and executives relative freedom. The business principles are still the same: Jaguar and Land Rover must make money. But when Ford hits a speed bump, Jaguar no longer also has to take a hit.

When asked what life was like under Tata ownership, Jaguar Land Rover chief engineer Bob Joyce had a unique perspective. He'd worked for BMW before being roped into Land Rover once Ford bought the 4WD brand in 2000. So, in effect, in the space of a decade or so, Joyce has seen how three big car companies operate, up close and personal.

"I think being part of a very large corporation [such as Ford] has got lots of benefits but it's also got lots of disadvantages... When Ford caught a cold we caught a cold," Joyce told the Carsales Network.

"In hindsight I think if we were still in the Ford group it would have been holding us back from where we want to get to."

Joyce was quick to point out, however, that Jaguar and Land Rover still have a good relationship with Ford.

"We still share technology, split parts with them. We learned a lot from Ford -- Ford's systems and processes are excellent and we copied those and used them and learned from them."

But everyone you speak to at Jaguar these days feels as if they're in a better place now. That's a stark contrast to the initial trepidation before they knew what life would be like under Indian ownership.

"Jaguar wouldn't have done a car like the XKR-S under Ford ownership because they didn't want us to get too close to Aston Martin," said another well placed insider.

"Tata has enabled us to strive to reach our potential. We can absolutely do some of the exciting and daring stuff we've wanted to do for years – but were either too scared or too conservative to do."

But there is a but.

"It's not a charity. Tata is like a bank in many ways. It is happy to invest money but wants it back and then some. As long as we are careful with their money and there is a business case, we can generally do things we've never been able to do."

Joyce says Tata has a longer term view of the business than Ford did. Ford generally planned five years out and wanted returns within that window. He says Jaguar and Land Rover have forecast their futures 15 years out.

"Tata has been fascinating in its desire for the company to grow," says Joyce.

"It's helped us through the difficult times. As you know, as soon as we became a separate company we went through one of the biggest recessions. Tata was paranoid while we managed our cash and the business to go through the recession, that we continued to invest and develop [new models]. Luckily we did, as we have some fresh models arriving now as the economy's come good."

The Indian company's skills in managing finances may be the perfect fit for a British outfit that has revived its ability to design, engineer and manufacture exciting cars.

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