Ford cuts cord on Jaguar, Land Rover brands

The Wall Street Journal and other sources report that Ford is exploring the sale of its Jaguar and Land Rover units as a way to trim money-losing operations. Ford spent billions of dollars to acquire the two car makers in 1989 and 2000 respectively, spent hundreds of millions more to upgrade and market them, but never figured out how to create new customers for the famed marques.

Why didn’t these expensive and highly visible acquisitions pan out for Ford? Here are some thoughts from a brand value perspective.

Brands are married, not “bought”

Brands flourish as shared passions between maker and buyer. Customers marry a cherished brand more than they “buy” it. It’s an emotional plunge. If a new corporate owner doesn’t have a deep and abiding passion for what makes the product and its customers tick—the living connections that infuse every aspect of the brand relationship—the new corporate brand marriage may be dysfunctional, or even sterile. Brands are a joining, from top to bottom. So, perhaps Ford’s biggest mistake was its approach to “buy” the brands in the first place, when a more physical relationship was called for. It arrived with spreadsheets instead of silk sheets.

Intensify the brand, or lose the brand

Great brands like Jaguar and Land Rover live by their own logic and passion. They create customers in their own image. This is a process of brand intensity, a reduction to pristine elements of heightened existence. If a new corporate owner makes a brand more of what it is, unleashing potential locked within, then the brand can thrive anew, as in BMW’s glorious resurrection of the Mini. But if a new corporate owner believes that buying a famed brand is nothing more than buying a selling point, the brand can lose its vision—for itself and its customers. Customers—always the brand canaries—will sense this in a heartbeat.

The interior feels low rent and, insignificant as it might sound, the electric aerial is a joke on a car costing in excess of £60,000. Jaguar needs to look forward and to change its focus. I know many point the finger of blame firmly at Jaguar’s Ford parent company, but the Blue Oval has poured money into the firm but the excuses always seem to be the same – ‘wait until you see what’s coming next’. Jaguar has tantalised us frequently in recent years with concepts promising new directions, svelte styling and innovation like the R-D6 concept . . . a big diesel GT four-door coupé. Did they build it? Nope.

Brand dilution dilutes customers

When you marry into aristocracy, as Ford did with Jaguar and Land Rover, you join the world of dukes and duchesses. You leave Dearborn far behind. This means producing marques that are extravagant in what they do, at a price to match, rather than diluted, entry-level lines churned out for sorties to Wal-Mart. Even though Ford made tremendous improvements in Jaguar quality and reliability, one of its lasting legacies will be its platform sharing strategies that put drivetrain and suspension components from mass-market Fords into the Jaguar brand. While this was highly cost-effective, it was hardly brand-effective.

Maybe “luxury brand” was the wrong category

Ford bought Jaguar and Land Rover to gain share in the automotive “luxury brand” market, but I’m wondering if categorizing these two marques as “luxury brands” may have been one of Ford’s strategic mistakes. It landed Ford in a nest of “Red Ocean” conundrums, from which they never really escaped. In their glory days these marques were high performance brands that originally appealed to high performance customers—unmistakable individuals who were going places with verve and energy (on-road and off-road). They were expansive brands. Dragging in the feather bed “luxury” label led Ford to aim the vehicles at the early adopter Geritol set. No wonder movers and shakers stayed away.

These are brands that under a different charter might have reinvented a high performance context, with a new breed of high-performance customers to match.

Not enough Dylan Thomas

Brands are the poetry of products, and poets can give us insight into the workings of brands. Dylan Thomas’s line, “the force that through the green fuse drives the flower” is a wonderful metaphor for a brand at work, with the customer as the flower. Ford might have read up on Thomas, and worked on a new force and fuse for Jaguar and Land Rover, to create a new customer flowering. Instead they seem to have spent their money on bouquets at the florist.

Photo: Jaguar XK 150 by evercool — Flickr
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3 Responses to “Ford cuts cord on Jaguar, Land Rover brands”

  1. Inside The Mind Of A Car Addict Says:

    Land Rover and Jaguar for Possible Sale…

    What else is new? I guess the Ford Motor Company is expecting this to happen. Few months ago, before the British brand Aston Martin was sold, they have admitted that they are expecting more falls this year. Like more job cuts, declines on sales, the …..

  2. steve Says:

    I wonder what the life expectancy of a high end car brand is. Jaguar was an embarrassment when Ford acquired it and Land Rover had also fallen on hard times.

    (in the case of Jaguar – imagine a performance car line without a manual transmission in sight, cornering performance that wasn’t up to $20,000 VWs and laughable build quality)

    Ford someone would have had to restore the cars to their former glory – not exactly an easy task for a huge design bureaucracy.

    But there are gems even at Ford. The SVG manages a bit of low volume magic. I would have taken one of the GT40s over any standard Ferrari.

  3. Brian Phipps Says:

    Same here for the GT40. But those were the creation of the “car guys” at Ford. The Jag and Land Rover purchases seem to have been the work of higher ups who felt the need for “image.” And that’s pretty much all they got.

    By SVG did you mean SVT — the Special Vehicle Team? Word is they have been pretty much closed down. Another loss for Ford.