How threatened is JLR?...sounds worrying
Discussion
They’re in a rush to reach critical mass against the biggest players. It wouldn’t be the first time someone has rushed into brand building. Most conglomerates appeared in very short time due to their industry’s sudden change of fortunes, seizing opportunity and hoping it all held together long enough for the current Board to fill their boots and retire. JLR is a big scalp for someone looking to climb up a rung.
Conversely, it wouldn’t be the first time either, that City pubs have been full of gossip that camento nothing.
Conversely, it wouldn’t be the first time either, that City pubs have been full of gossip that camento nothing.
Apparently it isn’t PSA but a private equity group.
I think the biggest worry for Jaguar is that it only still exists because the revenues from Land Rover allowed Ratan Tata to argue that he should keep his beloved brand alive.
The hope has to be that whoever the next owner of JLR is (because Tata don’t have the balance sheet to hold onto something that is no longer generating vast amounts of cash that for a decade has kept the whole Tata Group from defaulting in its tremendous debts) they buy into the EV plan to use Jaguar to offset Land Rover etc.
I think the biggest worry for Jaguar is that it only still exists because the revenues from Land Rover allowed Ratan Tata to argue that he should keep his beloved brand alive.
The hope has to be that whoever the next owner of JLR is (because Tata don’t have the balance sheet to hold onto something that is no longer generating vast amounts of cash that for a decade has kept the whole Tata Group from defaulting in its tremendous debts) they buy into the EV plan to use Jaguar to offset Land Rover etc.
01WE01 said:
This feels like its dangerously close to crossing the MAR boundaries. I would hope finance experts would be more careful than to post unsubstantiated rumours about future market activity on a public forum.
It’s no problem. It’s a rumour regarding something going on in the industry. The guess that it involves JLR is simply based on it being the only large group that is overtly in play at present. No listed entities mentioned. And Tata have publicly stated they are looking to sell a stake. Not much of a way to abuse a market. DonkeyApple said:
Apparently it isn’t PSA but a private equity group.
I think the biggest worry for Jaguar is that it only still exists because the revenues from Land Rover allowed Ratan Tata to argue that he should keep his beloved brand alive.
The hope has to be that whoever the next owner of JLR is (because Tata don’t have the balance sheet to hold onto something that is no longer generating vast amounts of cash that for a decade has kept the whole Tata Group from defaulting in its tremendous debts) they buy into the EV plan to use Jaguar to offset Land Rover etc.
Jaguar has to be on borrowed time. The market is moving towards SUVs, so you would want to transition Jag over to making luxury SUVs, except that is what your other brand does so they end up competing with each other.I think the biggest worry for Jaguar is that it only still exists because the revenues from Land Rover allowed Ratan Tata to argue that he should keep his beloved brand alive.
The hope has to be that whoever the next owner of JLR is (because Tata don’t have the balance sheet to hold onto something that is no longer generating vast amounts of cash that for a decade has kept the whole Tata Group from defaulting in its tremendous debts) they buy into the EV plan to use Jaguar to offset Land Rover etc.
Making Jag EV only is short term because eventually LR has to go EV.
Sadly I think Jag's time has come. They're not seen as a sports car manufacturer so can't command prices that are high enough to only play in that market, and let's face it Porsche make SUV's now as well. Anyone wanting a luxury saloon will look at Merc or BMW before Jag so there is no room to make them a (very) niche player in that space.
I don't think the Jaguar brand has any real value to anyone - it doesn't really stand for anything unique, nothing that another major player doesn't offer. I don't think anyone has the time or the money to turn that round.
Jader1973 said:
Jaguar has to be on borrowed time. The market is moving towards SUVs, so you would want to transition Jag over to making luxury SUVs, except that is what your other brand does so they end up competing with each other.
Making Jag EV only is short term because eventually LR has to go EV.
Sadly I think Jag's time has come. They're not seen as a sports car manufacturer so can't command prices that are high enough to only play in that market, and let's face it Porsche make SUV's now as well. Anyone wanting a luxury saloon will look at Merc or BMW before Jag so there is no room to make them a (very) niche player in that space.
I don't think the Jaguar brand has any real value to anyone - it doesn't really stand for anything unique, nothing that another major player doesn't offer. I don't think anyone has the time or the money to turn that round.
I think one of the reasons they started building SUVs was so that the two brands could be pulled apart. Without an SUV, Jaguar really had no value. Making Jag EV only is short term because eventually LR has to go EV.
Sadly I think Jag's time has come. They're not seen as a sports car manufacturer so can't command prices that are high enough to only play in that market, and let's face it Porsche make SUV's now as well. Anyone wanting a luxury saloon will look at Merc or BMW before Jag so there is no room to make them a (very) niche player in that space.
I don't think the Jaguar brand has any real value to anyone - it doesn't really stand for anything unique, nothing that another major player doesn't offer. I don't think anyone has the time or the money to turn that round.
As a business they’ve had two really big belly blows over the decade, obviously they sank a lot of investment into a Diesel engine plan that was late to the party and then crippled by dieselgate and the plan to get volume from the fleet and lease market with the XE hasn’t worked out.
As you say, while EV seems to be a third and final solution, LR has to go that way anyway and it is also an area which is fraught with much higher risks than normal because of the higher pace of change, sometimes overnight. Hence why most mainstream manufacturers are paying it lip service rather than making it their core source of revenue.
They probably would have spun Jaguar off a long time ago if Ratan Tata hadn’t been in control and today it is hard to see the value of what is a low volume SUV manufacturer. But it’s always worth noting that we look at these things with a UK centric vision. Banging out Chinese EVs for the enforced Chinese market and sticking a British badge on the product is probably of value as may be other opportunities. But you have to imagine that most parties would demand LR is included in any deal?
One has to wonder what will actually be left of Tata Group post C19. They were in a mess beforehand, technically a zombie business for the last decade, kept afloat by JLR’s gross revenues helping to meet the monthly debt financing. As an industrial conglomerate they are unlikely to have many business units who have increased revenues in 2020.
Jader1973 said:
Jaguar has to be on borrowed time. The market is moving towards SUVs, so you would want to transition Jag over to making luxury SUVs, except that is what your other brand does so they end up competing with each other.
Making Jag EV only is short term because eventually LR has to go EV.
Sadly I think Jag's time has come. They're not seen as a sports car manufacturer so can't command prices that are high enough to only play in that market, and let's face it Porsche make SUV's now as well. Anyone wanting a luxury saloon will look at Merc or BMW before Jag so there is no room to make them a (very) niche player in that space.
I don't think the Jaguar brand has any real value to anyone - it doesn't really stand for anything unique, nothing that another major player doesn't offer. I don't think anyone has the time or the money to turn that round.
Theres no doubting just how dominant the German brands are, but Jaguar is a good antidote if you want a similar car but just dont fancy a German one. Obviously, that isn't a lot of people, and you then have to compete with the likes of Volvo, Lexus and Alfa - which is struggling too. I'm not convinced by the whole 'its british' so must be a big seller here. We like German cars.Making Jag EV only is short term because eventually LR has to go EV.
Sadly I think Jag's time has come. They're not seen as a sports car manufacturer so can't command prices that are high enough to only play in that market, and let's face it Porsche make SUV's now as well. Anyone wanting a luxury saloon will look at Merc or BMW before Jag so there is no room to make them a (very) niche player in that space.
I don't think the Jaguar brand has any real value to anyone - it doesn't really stand for anything unique, nothing that another major player doesn't offer. I don't think anyone has the time or the money to turn that round.
The I-Pace is a good car and quite distinct from anything LR sell, if they could focus on multiples of that - scale it up and down, perhaps they could be on to a winner.
Argleton said:
Theres no doubting just how dominant the German brands are, but Jaguar is a good antidote if you want a similar car but just dont fancy a German one. Obviously, that isn't a lot of people, and you then have to compete with the likes of Volvo, Lexus and Alfa - which is struggling too. I'm not convinced by the whole 'its british' so must be a big seller here. We like German cars.
The I-Pace is a good car and quite distinct from anything LR sell, if they could focus on multiples of that - scale it up and down, perhaps they could be on to a winner.
When you sit in another country and think of England the image is that of Buckingham Palace, red phone boxes, London taxis, the Rolling Stones, Ed Sheeran and all the visual exports that draw millions of tourists every year. British brands such as Jaguar fit that image for those 8bn people not fortunate enough to be randomly born here. The I-Pace is a good car and quite distinct from anything LR sell, if they could focus on multiples of that - scale it up and down, perhaps they could be on to a winner.
Conversely, when you sit in Britain and look at it you think of fat drunken slags and yobs, mirror addicted debt monkeys, pensioners either waddling down provincial high streets or clogging the roads while whinging about how easy life is for them and seismic rafts of low functioning cretins blasted 24/7 on your TV screen. It all tends to weigh on our desire for British brands. Instead, we gloss over the racist and rather boring elements of Germany and focus on their touristic image exports of efficiency and reliability and get drawn to their brands.
They make good, solid middlenof the road transport and Jaguar, as you say, is stuck trying to compete in a very difficult place.
The ipace is cracking but there simply isn’t yet natural EV demand at levels to make it viable for Jaguar to just sell EVs.
With a UK perspective it is really hard to see the future for the brand.
The Germans also manage to offer more variants of their models.
If you are looking at the XE, C Class , 3 series segment. The Germans will offer you a saloon, estate, coupe, and convertible. You can also have an M sport/ AMG performance version.
Jag offers a 4 pot, 4 door or nothing.
Add to that the 6 figure daily warranty bill and its hemorrhaging cash.
The corporate culture is horrible and no one seems to have any control or accountability.
If you are looking at the XE, C Class , 3 series segment. The Germans will offer you a saloon, estate, coupe, and convertible. You can also have an M sport/ AMG performance version.
Jag offers a 4 pot, 4 door or nothing.
Add to that the 6 figure daily warranty bill and its hemorrhaging cash.
The corporate culture is horrible and no one seems to have any control or accountability.
lornemalvo said:
irocfan said:
lornemalvo said:
My interpretation of a high quality car is one that should reach 199, 000 maybe 150,000 miles without major issues.
by that metric you only have to look at US pick-up trucks...DonkeyApple said:
I think one of the reasons they started building SUVs was so that the two brands could be pulled apart. Without an SUV, Jaguar really had no value.
As a business they’ve had two really big belly blows over the decade, obviously they sank a lot of investment into a Diesel engine plan that was late to the party and then crippled by dieselgate and the plan to get volume from the fleet and lease market with the XE hasn’t worked out.
As you say, while EV seems to be a third and final solution, LR has to go that way anyway and it is also an area which is fraught with much higher risks than normal because of the higher pace of change, sometimes overnight. Hence why most mainstream manufacturers are paying it lip service rather than making it their core source of revenue.
They probably would have spun Jaguar off a long time ago if Ratan Tata hadn’t been in control and today it is hard to see the value of what is a low volume SUV manufacturer. But it’s always worth noting that we look at these things with a UK centric vision. Banging out Chinese EVs for the enforced Chinese market and sticking a British badge on the product is probably of value as may be other opportunities. But you have to imagine that most parties would demand LR is included in any deal?
One has to wonder what will actually be left of Tata Group post C19. They were in a mess beforehand, technically a zombie business for the last decade, kept afloat by JLR’s gross revenues helping to meet the monthly debt financing. As an industrial conglomerate they are unlikely to have many business units who have increased revenues in 2020.
Jaguar's history is littered with alternating brilliance and comedy errors. Ford sorted the quality issues leaving Jaguar with a superb product selling to a loyal niche market, which they then abandoned in pursuit of mass market diesels to which no traditional buyer would offer garage space.As a business they’ve had two really big belly blows over the decade, obviously they sank a lot of investment into a Diesel engine plan that was late to the party and then crippled by dieselgate and the plan to get volume from the fleet and lease market with the XE hasn’t worked out.
As you say, while EV seems to be a third and final solution, LR has to go that way anyway and it is also an area which is fraught with much higher risks than normal because of the higher pace of change, sometimes overnight. Hence why most mainstream manufacturers are paying it lip service rather than making it their core source of revenue.
They probably would have spun Jaguar off a long time ago if Ratan Tata hadn’t been in control and today it is hard to see the value of what is a low volume SUV manufacturer. But it’s always worth noting that we look at these things with a UK centric vision. Banging out Chinese EVs for the enforced Chinese market and sticking a British badge on the product is probably of value as may be other opportunities. But you have to imagine that most parties would demand LR is included in any deal?
One has to wonder what will actually be left of Tata Group post C19. They were in a mess beforehand, technically a zombie business for the last decade, kept afloat by JLR’s gross revenues helping to meet the monthly debt financing. As an industrial conglomerate they are unlikely to have many business units who have increased revenues in 2020.
Someone once quipped that Speth, although Jaguar CEO, was still employed by BMW, to sabotage the competition.
Tend to agree but Ford flogged lots of those diesel S types and the other one. It was those two models which kept Jaguar solvent as a unit under Ford. I think the traditional Jag customer absolutely leaped at the chance of a diesel Jag and all it’s cheaper fuel, cheaper taxes.
The timing of their own Diesel engines couldn’t have been worse though. They hung on the petrol engines way too long and watched their customers have to go to the competition to spend £40k to get the lower VED and then dieselgate made those very same customers who couldn’t suck up enough diesel wake up in the morning despising the stuff and it’s filthy germanicness.
Lots of old boys on PH bang on about not liking the look of the new cars but that’s a cover for their abject adoration of diesel and then their overnight hatred of it.
If Jaguar has gone in house diesel earlier then their balance sheet would probably look quite different to now.
Either way, I can’t imagine anyone taking a stake or buying J without getting LR to soften the blow.
The timing of their own Diesel engines couldn’t have been worse though. They hung on the petrol engines way too long and watched their customers have to go to the competition to spend £40k to get the lower VED and then dieselgate made those very same customers who couldn’t suck up enough diesel wake up in the morning despising the stuff and it’s filthy germanicness.
Lots of old boys on PH bang on about not liking the look of the new cars but that’s a cover for their abject adoration of diesel and then their overnight hatred of it.
If Jaguar has gone in house diesel earlier then their balance sheet would probably look quite different to now.
Either way, I can’t imagine anyone taking a stake or buying J without getting LR to soften the blow.
DonkeyApple said:
Tend to agree but Ford flogged lots of those diesel S types and the other one. It was those two models which kept Jaguar solvent as a unit under Ford. I think the traditional Jag customer absolutely leaped at the chance of a diesel Jag and all it’s cheaper fuel, cheaper taxes.
The timing of their own Diesel engines couldn’t have been worse though. They hung on the petrol engines way too long and watched their customers have to go to the competition to spend £40k to get the lower VED and then dieselgate made those very same customers who couldn’t suck up enough diesel wake up in the morning despising the stuff and it’s filthy germanicness.
Lots of old boys on PH bang on about not liking the look of the new cars but that’s a cover for their abject adoration of diesel and then their overnight hatred of it.
[B]
If Jaguar has gone in house diesel earlier then their balance sheet would probably look quite different to now. [/B]
Either way, I can’t imagine anyone taking a stake or buying J without getting LR to soften the blow.
Ironically, given the issues with ingenium engine balance shafts, their balance sheet might have been a whole lot worse. The timing of their own Diesel engines couldn’t have been worse though. They hung on the petrol engines way too long and watched their customers have to go to the competition to spend £40k to get the lower VED and then dieselgate made those very same customers who couldn’t suck up enough diesel wake up in the morning despising the stuff and it’s filthy germanicness.
Lots of old boys on PH bang on about not liking the look of the new cars but that’s a cover for their abject adoration of diesel and then their overnight hatred of it.
[B]
If Jaguar has gone in house diesel earlier then their balance sheet would probably look quite different to now. [/B]
Either way, I can’t imagine anyone taking a stake or buying J without getting LR to soften the blow.
7000 miles and having to have an engine removed and stripped isn't a desirable place to be.
Sadly, I agree that Jaguar's time has probably come.
They are very much in the same place as Rover in 2000:
- Years spent failing to capitalise on what they've got right or fix what they've got wrong.
- Brand devalued by over-expansion of the range and core values watered down to the point of anonymity.
- Reliability and quality continually poor.
- Dealer service poor.
- Distribution outside of the UK poor.
- Model range uncompetitive.
- Parent company in financial trouble.
- Market conditions unusually hostile and future very uncertain.
I'm not sure they have the capability or opportunity to suddenly start getting it right and turn Jaguar around. They've sucked away what life it had. Pre-XE launch, Jaguar did at least have a loyal customer base and a reputation for being a luxurious, slightly rakish British car with a sporty edge. They began to build on that with the first XF and last XK, opening up the brand to new buyers but keeping within that niche space. They then threw that out of the window and decided to make anonymous diesel fleet cars. That these cars were not very good just sealed the deal.
It will be a very, very sad day but I fear those scenes from March 2000 when BMW broke up Rover will be repeating themselves some day soon.
They are very much in the same place as Rover in 2000:
- Years spent failing to capitalise on what they've got right or fix what they've got wrong.
- Brand devalued by over-expansion of the range and core values watered down to the point of anonymity.
- Reliability and quality continually poor.
- Dealer service poor.
- Distribution outside of the UK poor.
- Model range uncompetitive.
- Parent company in financial trouble.
- Market conditions unusually hostile and future very uncertain.
I'm not sure they have the capability or opportunity to suddenly start getting it right and turn Jaguar around. They've sucked away what life it had. Pre-XE launch, Jaguar did at least have a loyal customer base and a reputation for being a luxurious, slightly rakish British car with a sporty edge. They began to build on that with the first XF and last XK, opening up the brand to new buyers but keeping within that niche space. They then threw that out of the window and decided to make anonymous diesel fleet cars. That these cars were not very good just sealed the deal.
It will be a very, very sad day but I fear those scenes from March 2000 when BMW broke up Rover will be repeating themselves some day soon.
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