What next for Jaguar?

There’s another part of BMW’s long-term strategy document (see separate story) that is also potentially highly significant: it is not ruling out further car company acquisitions, and most certainly has the earnings and cash pile to make them.

Not, however, Jaguar or Land Rover. Clearly, BMW has given both the once-over. But, says the strategy document dismissively – ‘any new brand would have to at least make the same positive contribution to earnings as the existing automotive business. However, an in-depth analysis found that none of the evaluated brands currently meets these requirements.’

BMW’s strategy was being set out as the fog surrounding who may or may not buy Jaguar and/or Land Rover continued to thicken. The end of September was the deadline for expressions of interest, after which Ford was due to start receiving firm bids.

However, despite another private equity group, Terra Firma, joining the fray, there are increasing rumblings of discontent from the potential bidders, which include some distinguished car industry hands (former Ford president Jac Nasser at One Equity Partners, ex-Jag chairman Sir Nick Scheele at Cerberus, and former Jaguar and Aston Martin boss Bob Dover at Ripplewood).

Is Ford, in fact, having a change of heart?

Bidding for companies like Jaguar and Land Rover is a hugely expensive business, requiring heavy spending on due diligence, particularly in the case of Jaguar, whose losses run into hundreds of millions. Yet, despite growing pressure from the private equity groups, by early October Ford was still refusing to state categorically that it will actually sell either company.

As October advanced, and despite putting in forecasts of what it might get from a sale in its mid-year accounts, Ford’s official stance remained that it has made no final decision. In the absence of such a commitment, the private equity groups – clear favourites if a deal is eventually done – were starting to baulk at spending any more money on the bid process.

The whole process thus seemed to be slowing down, even as Jaguar was preparing for the world press launch of its already much-praised, make-or-break XF saloon in December. With Ford insiders acknowledging that there was virtually zero chance of any deals being done before year end, the wait-and-see approach is starting to make a sale look no longer like a foregone conclusion.