Ford helps Jaguar recover from financial losses
US based automotive giant Ford is itself in a deep financial mess in their domestic market. However, they have taken the important step by injecting close to around $2.08 billion into their UK based subsidiary Jaguar to help them recover from heavy losses and investment writedowns. Ford had taken over this famous luxury carmaker some years ago and even tried making an impact in the F1 circuit using the Jaguar brand. However, that mission had failed miserably as well.
Jaguar officials have not commented on these fresh investments by their parent company. And this happens to be the second time Ford had to come to their rescue in the last couple of years as Jaguar is suffering from poor sales and revenue performances. Reports say that Jaguar made a pretax loss of 429.3 million pounds in 2004. This is a slight improvement over their previous yearâ€™s performance when they made losses of around 601.1 million pounds.
Ford had also declined to break out separate profit statements for Jaguar. Jaguar in fact declined to restate their promise that they would be breaking even in the next two years. Looks like it would take them more time to get back to profitability helping their parent company with some profit earnings.
The problems with Jaguar are not going to help Ford itself considering they are making huge losses themselves in their home market. The company is set to announce a massive restructuring plan next month, which is expected to include massive job cuts in their workforce and many plant closures. These investments in their UK based subsidiary are not going to help the cause with their workers in the US.