Ford announced on Wednesday the sale of its Jaguar and Land Rover luxury brands to India’s largest automaker, Tata Motors. The deal will include the brands, plants and Intellectual Property Rights, all for a cash sum of about $2.3 billion, with a commitment from Ford to pay out $600 million in future pensions to retired employees of the two brands. The purchase is to be completed by the end of June, the second quarter of the year, pending government approvals.
Other stipulations of the contract include Ford continuing to supply Jaguar and Land Rover powertrains, stampings and other components, as well as environmental and platform technologies, among others, for unspecified and differing amounts of time. Ford will also provide engineering support, research and development, information technology, accounting and other services.
In some markets, Ford will continue to provide financing for Jaguar and Land Rover dealers and customers for up to 12 months.
“We have enormous respect for the two brands and will endeavor to preserve and build on their heritage and competitiveness, keeping their identities intact,” said Ratan Tata, Chairman of Tata Sons and Tata Motors. “We aim to support their growth, while holding true to our principles of allowing the management and employees to bring their experience and expertise to bear on the growth of the business.”
“Jaguar and Land Rover are terrific brands,” commented Alan Mulally, Ford’s CEO. “We are confident that they are leaving our fold with the products, plan and team to continue to thrive under Tata’s stewardship. Now, it is time for Ford to concentrate on integrating the Ford brand globally.”
