Ian Nicholls, AROnline’s historian, turns his attention to Jaguar – and looks at its fall and rise in the 1990s, an era when the German manufacturers were beginning to take over the world.
Here, in Part Five – the final instalment – he recounts how the company ended up heading down today’s road to success under the tutelage of Tata Motor.
In the past four instalments, we have discussed Jaguar’s transition from private company into Ford’s flagship brand. However, we have not really discussed what exactly was Ford’s master plan for Jaguar?
From what was said by Ford and Jaguar executives and based on the excellent 1998 sales figures, we come up with this: the plan was that, by 2002, Jaguar would be selling 200,000 cars a year.
It would be achieved this way
The road to Ford’s sale of Jaguar to Tata in 2008 began in April 1999, when the new S-Type went on sale. The top of the range models featured the 4.0-litre V8 already found in the XJ8 and XK8 models mated to a five-speed automatic transmission.
New to the S-Type was a 3.0-litre V6 based on a Ford bottom end, with a Jaguar cylinder head. This was known as the AJ-V6.
In the past, the use of a non-Jaguar engine would have been considered sacrilegious – Jaguar had, after all, spurned the Rover V8 and now had to accept a unit based on the Ford Duratec V6.
This impressive engine produced 240bhp at a high 6800rpm and could be had with manual as well as automatic transmission. As related earlier, there was no diesel option. The S-Type shared its underpinnings with the 2000 Lincoln LS and took advantage of the economies of scale offered by Ford.
S-Type leads the way
By the end of Friday 16 April 1999, Jaguar dealers had taken 20,000 firm orders for the new S-Type, worth some £650m at showroom prices. They had received a further 35,000 inquiries. This meant Jaguar was set to produce 80,000 cars in 1999, following record production of 50,000 cars in 1998. The company expected to meet its goal of selling 40,000 S-Types in 1999.
‘During the past six years, we have rebuilt the company, transformed our manufacturing facilities, rethought our production processes and listened to our customers. The S-Type is the beginning of a new period of growth,’ said Nick Sheele, the Jaguar Chairman.
On 11 June 1999, Jonathan Browning was appointed Managing Director of Jaguar and, five days later, Nick Scheele was promoted to the post of President of Ford of Europe. Jonathan Browning came to Jaguar from Ford where he had been Executive Director, Marketing in Ford’s European Marketing, Sales and Service organisation since July 1997. Prior to this he had been with General Motors since 1981.
Ian Callum arrives
Sadly, on 24 June 1999, Styling Director Geoff Lawson died of a heart attack at the Jaguar Technical Centre at Whitley, aged 54. Within a month, Jaguar named ex-Ford, TWR and Aston Martin man Ian Callum (right) as its new Design Director in succession to Geoff Lawson.
Ian Callum also had the authority to design the cars he wanted to and not continue with the retro theme – this would represent something of a sea change in Jaguar design. In the summer of 1999 the retro look still seemed to be a successful avenue of design exploration, but it would soon hit the rocks.
On 3 December 1999 Jaguar announced the appointment of Stuart Dyble to replace Joe Greenwell as Director of Communications and Public Affairs. After all the public relations effort leading up to the arrival of the X200, Jaguar’s 1999 sales figures were a bit of an anti-climax.
The other Jaguars underperform
Despite having not yet been on sale for a full year, the new S-Type sold an impressive 53,000 cars, so under the Ford master plan Jaguar should have sold 103,000 vehicles – except it didn’t. In 1999, Jaguar sold 86,325 units. X100 XK production slumped 13.61 per cent while that of the X308 XJ collapsed from 36,800 in 1998 to 21,900 in 1999, a fall of 40.48 per cent!
Quite clearly around 14,000-15,000 XJ customers had migrated to the new S-Type, and were not conquest sales from companies such as BMW, Mercedes-Benz and Lexus. These were what one might call substitutional sales. XJ sales would recover slightly to 23,100 in 2000 but, apart from 2003 – the first full year the X350 was on the market – XJ sales would never again top the 20,000 mark.
This sales slump would eventually lead to the closure of the Browns Lane plant in 2005. For many loyal Jaguar customers the S-Type offered all the traditional refinements they expected in a more compact package, which meant it was less cumbersome to drive in urban areas.
On 18 January 2000 Jaguar announced the appointment of Julian Thomson as Chief Designer, Advanced Design Studio.
Julian Thomson came to Jaguar from Volkswagen in Barcelona where he had been Chief Designer. He had also worked for Ford and Lotus.
Jaguar and Land Rover reunited
Since October 1998 and the botched Rover 75 launch, the motor industry headlines had been dominated by BMW and Rover. In early 2000, BMW announced it was disposing of the Longbridge plant and selling the Land Rover division. Ford quickly moved in to buy Land Rover for £1.85bn with effect from 30 June. Ford moved senior Jaguar engineer and former Land Rover man Bob Dover to take charge at Solihull.
Buyers were increasingly switching to 4×4 vehicles instead of traditional saloon cars, something Land Rover was exploiting with its Freelander and Discovery models, while the Range Rover had been moved upmarket to compete in the luxury car sector and was now a direct XJ competitor.
Land Rover was the future of the passenger car, as dictated by market forces, and Jaguar would struggle in the shadow of its new partner in the Premier Automotive Group. Eventually, a policy of part sharing would see Jaguar engines being used in a new generation of Land Rovers. It also meant the two companies were now intertwined.
On 31 August 2000, Bob Knight (right), former Jaguar Managing Director and brilliant Chassis Engineer died. He was the last of the old guard of Jaguar’s brilliant engineers and was credited by Geoffrey Robinson as being the man who made the original XJ saloon the outstanding car it was.
Then, on 20 September 2000, Jaguar Finance Director Bibiana Boerio was appointed as the Executive Vice-President and CFO of Ford Motor Credit. She would return to Jaguar as Managing Director.
X-Type: final piece of the jigsaw
The Jaguar X-Type was launched in February 2001, the final part of the Ford jigsaw that would establish Jaguar as a viable player in the premium sector. There was no doubting that the new baby Jaguar was a well-built and competent machine, but it was probably the most controversial car ever to wear the Jaguar badge.
The fact that it shared a floorpan with the Ford Mondeo MkIII resulted in the public at large pouring scorn on its breeding, despite the fact that some of its German rivals also shared major components with more humdrum family cars. Then there was the styling… The shrivelled XJ look screamed old man’s car at a time when companies such as BMW were adopting more progressive, forward-thinking designs.
The 2.5- and 3.0-litre versions used the AJ-V6 engines already seen in the S-Type but with the addition of four-wheel drive. The top of the range 3.0-litre was no slouch. In manual form it could match the Series III E-type Roadster for both top speed and acceleration, such was progress over three decades.
The 2 .0-litre version would be the big seller, but again there was no diesel option.
Sales fail to accelerate
In 2002, Jaguar sold 122,325 cars, well short of target.
Again, the introduction of a new car appeared to result in Jaguar customers migrating from the premium models to the lower-priced S-Type. S-Type sales declined from 53,500 in 2000 to 36,150 in 2002, a decline of 32.4 per cent. While it could be argued that the S-Type was more refined than the X-Type, the 2.5- and 3.0-litre X-Types came with four-wheel drive as standard, something the larger car did not have – from that point of view, the X-Type seemed to represent better value for the money.
X350 points to aluminium future
In September 2002 the new all aluminium X350 XJ saloon was announced at the Paris Motor Show. The sales figures in 2003 seemed to suggest that Jaguar was on to another winner, with 26,950 being sold that year, the best since 1998. The XJ series had been rejuvenated in the form of the X350, which had no XJ40 DNA whatsoever under the skin.
The X350 and X-Type had been designed at roughly the same time so it was easy to see how the bigger car’s styling cues had been used on the baby Jaguar. The year of 2003 was Jaguar’s most successful year ever, with sales of 126,100 cars, but this was still way short of Ford’s 200,000 target for it. This relative success was achieved by the new X350 XJ, while sales of the smaller S-Type and X-Type went into decline.
However, by 2004, X350 sales had slumped to 15,000. With each new XJ launch the motoring media had claimed that Jaguar had at last built a car to match its German rivals – in truth, this had been the case since the X300 had appeared in 1994. The luxury car market was changing and, for those who wanted a family barge without stretching their finances to a Rolls Royce, there was now plenty of choice, and some of these had completely different design philosophies to the traditional Jaguar XJ.
Internal opposition from Range Rover
As well as BMW and Mercedes-Benz saloons, there were SUV-type vehicles such as the BMW X5 and the Porsche Cayenne, and then there was the L322 Range Rover. The demands for increased interior space had resulted in the X350 being longer and wider, and more of a handful in urban traffic. Luxury car owners demanded gizmos that made their life easier, longer cars in a world of increasing traffic congestion, did not make life easier. An alternative solution was to build a higher vehicle, hence the popularity of SUVs.
Although the Range Rover itself had been around since 1970, the serious drift to 4×4 passenger vehicles did not really manifest itself until the 1990s and, when Jaguar sold 36,800 X308s in 1998, neither the BMW X5, Porsche Cayenne and L322 Range Rover were on the market. The BMW-developed L322 Range Rover was regarded in the 2000s as a candidate for the best car in the world, regardless of price, by many pundits. Now, with Jaguar a member of Ford’s Premier Automotive Group, the Range Rover had been starved of serious investment and the second-generation P38A was an evolution of the original Spen King design.
The L322 was a completely new design employing the latest technology to produce a vehicle to BMW standards and was the pet project of Wolfgang Reitzle, who now found himself back in overall charge of it. By 2005, Jaguar was in crisis while Land Rover was booming. Jaguar sold 84,025 cars, of which only 17,000 emerged from Browns Lane. The decision was taken to close Jaguar’s traditional home and transfer production to Halewood and Castle Bromwich.
Browns Lane closes
Joe Greenwell, now the Jaguar boss, faced MPs over the closure of Browns Lane, later admitting: ‘It was a failed growth strategy. We were over optimistic and we under-estimated the amount of competitive activity, which is a typical and dangerous assumption to make when you are in management.’
At least Ford, unlike BMW with Rover, had the courage to admit it had cocked up. Not surprisingly, the Trade Unions took the view that the Browns Lane workforce had been let down by Ford, and it is hard to disagree with that viewpoint. Ford’s grandiose plan for expanding Jaguar into a serious BMW rival had categorically and publicly failed, and this was in the same year that MG Rover ceased trading.
Was it the continuance of retro styling, or should Jaguar have developed its own SUV long before the F-Pace was dreamt of?
Certainly, the introduction of smaller models did lead to a mass migration of customers away from the XJ range to the detriment of profits. Moreover, while the S-Type and X-Type did have some initial success, it was nowhere near the sales forecasts and, after the launch, began to fade away.
In 2007, Jaguar sales slumped to 54,050, only 4025 more than in 1998 when the company only made two models. By then, Ford was actively looking to dispose of Jaguar, but because it was now technically intertwined with the profitable Land Rover, one part could not be sold without the other.
In 2008, Ford divested itself of Jaguar and Land Rover to Tata of India for £1.15bn. However, remember that Ford had paid £1.6bn for Jaguar in 1990 and £1.85bn for Land Rover in 2000, a total of £3.45bn. Not counting the huge amounts of capital invested in both companies, Ford lost £2.3bn overall in its attempt to turn Jaguar Land Rover into major world players.
Ford’s lasting legacy was to inject modern management and development processes into both companies enabling them to move into a brighter future with Tata, but that is another story.
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