Ford hires banks to sell Jaguar, Land Rover

Ford Motor has given Goldman Sachs, Morgan Stanley and HSBC a mandate to sell Jaguar and Land Rover, its two British luxury brands. Read original article

The planned sale does not include Volvo, Ford’s third premium marque, and is said to be in its early stages.

The news follows persistent speculation that Ford, which sold the Aston Martin sports car marque to a Kuwaiti-led consortium in March, might look to unload the two brands as part of its drive to create a more streamlined and competitive volume car business.

Ford is understood to be selling the two brands jointly because of the significant overlap of their operations.

The US company, which reported a record loss of $12.7bn last year, is in the midst of its “Way Forward” restructuring plan, aimed at restoring its competitiveness and returning its core North American operation to profitability in 2009.

Ford may have an easier time selling its two British brands to private equity investors than a rival carmaker.

Fiat Auto on Monday denied reports that it considered buying the two brands. Renault also denied a report that it was interested in buying the brands.

A spokeswoman for Alchemy Partners denied a newspaper report that the private equity group was lining up a £3bn bid to buy the brands. Alchemy had been interested in Jaguar and Land Rover, she said, “but only at the emotional level”.

Alchemy had not spoken to anyone about Ford’s sale of the two marques, she added.

Ford’s Premier Automotive Group, which owns Volvo, Jaguar and Aston Martin, saw its pre-tax loss last year widen to $327 m from $89 m the previous year.

Ford does not report on the individual brands’ financial results, but Jaguar is understood to have accounted for much of the loss. Despite a buoyant world market for luxury cars, the brand’s portfolio has struggled against its competitors.

A spokesman for Premier Automotive Group declined to confirm or deny what he called “speculation” about the sale.

Ford, which lined up a $23bn financing package to see it through its restructuring late last year, has repeatedly denied immediate plans to sell the two brands. When Aston Martin was sold in March Lewis Booth, PAG’s head, said: “Jaguar and Land Rover are not for sale.”