Ford's Sale Of Land Rover and Jaguar to Tata

From the always-useful Oligopoly Watch:

Ford announced this week that it has completed the deal to sell their Jaguar and Land Rover divisions to India's Tata Motors, that country's largest car and truck maker. The deal was for $1.7 billion.

What a turnaround! Ford's purchase of Jaguar in 1989 and cost $2.6 billion. The 1999 purchase of Land Rover from BMW cost $2.75 billion. Both divisions have been steady money losers, an anchor. Land Rover was a hot potato, as BMW had apparently lost millions on the company after buying it 1994. So Ford sold Tat the two groups for less than a third of what it paid, over and above the year-to-year losses. ...

The problem is that these brands may never be salvageable, no matter how little Tata pays for them. These brands may be famous, but they are also infamous for expensive service and poor reliability, in a market where there are already many competitors. Both brands sales are steadily dropping. And, with awakening global economy, there will be even fewer buyers who can afford them.