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Ford expects PAG profit in 2007by Nick Aziz
Ford expects its struggling Premier Automotive Group will turn a profit this year, Ford's financial chief Don Leclair said. "We expect PAG to be profitable this year," the CFO told Automotive News.
The PAG consists of Volvo, Jaguar, Land Rover, and Aston Martin. Despite its success, Ford intends to sell Aston Martin in order to raise capital, meaning the automaker will be left with three PAG brands.
Ultimately, profitability at the PAG in 2007 relies mostly on success at Volvo. If the company -- which typically earns $800 million to $1.2 billion a year -- make up for Jaguar's losses, then the premier group will be back in black for '07. Over the past several years, Jaguar has lost $500 million to $1 billion annually. Land Rover is believed to be virtually break-even, edging out a small profit in 2006.
Although Volvo sales slumped in 2006, this year is expected to see a sharp increase in shipments, thanks to the all-new C30, and the redesigned S80 and C70.
Leclair made it clear the profit would not include a one-time gain from the sale of Aston Martin.