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JAGUAR STARTS TO PURR: Brand gets back in touch with its luxury identity -- and the results are promising



Jaguar XKR
Photo by Global Auto Index

Images of a Jaguar pulse excitedly onto a TV screen of open road.

Light from the sun, streetlights and candles splashes onto Jags in motion like fistfuls of happy glitter.

The wheels spin like a turntable in a disco. Stunning women with engaging eyes and elegant curves rendezvous with mysterious playboys in dark sunglasses.

This is Gorgeous, a heart-revving, contemporary advertising campaign that aims to set the new, exclusive-again tone for the Jaguar nameplate and promote the brand's sleek new aluminum XK sports car launched in April.

The mood is downright enticing. It's a modern, Gatsby-esque fairyland of decadence, colored by helicopters, yachts, dance floors, poolside leisure time and oodles of Jaguars.

A red button urges: "START engine."

Could it be that Ford Motor Co. is finally getting it right this time?

Since purchasing Jaguar in 1989, Ford has sunk an estimated $10 billion -- including the $2.5-billion purchase price -- into the sexy, alluring British brand while whipsawing it through a variety of strategies that experts say have delivered more damage and embarrassment than profit to Dearborn-based Ford.

That's especially true for the "Baby Jag" effort that bombed. In 2002, Jaguar rolled out the new X-Type, a vehicle designed to attract a younger, more mainstream Jaguar driver than before. The move, Ford hoped, would drive high sales volumes like the BMW 3-Series or Mercedes C-Class.

But the $30,000-plus sedan was built off the Ford Mondeo, a compact economy car. It didn't deliver the styling, engineering or quality most customers expected. Ultimately, it was a serious strike against the Jaguar image.

Ford won't confirm how much Jaguar has so far lost its Premier Automotive Group, the division that manages Ford's luxury brands. Two years into a sweeping turnaround plan, Jaguar quality is rock-solid, but the brand still loses money. Ford won't say when it will be profitable.

Yet there are exciting signs -- in the XK, the recently unveiled XKR and this Gorgeous campaign -- that Jaguar's turnaround plan has finally put the brand in touch with its true identity: Fast, beautiful cars that remain safely out of the common man's reach at $50,000 and up.

Consequently, a bona fide recovery seems underfoot at Jaguar.

"It's the start of a new future for Jaguar," Mike O'Driscoll, president of Aston Martin, Jaguar and Land Rover in North America, declared in an interview with the Free Press this spring. "This is a very focused strategy to realign the brand."

The proof, of course, is always in the showroom. And Jaguar dealers across the country report that the new XK, starting at $75,500, attracts youthful luxury buyers (in their 40s) and is selling fast.

"I'm sold out. I need more," said Jaguar dealer Frank Ursomarso of Wilmington, Del. "That car is a hit. It's beautiful."

Molly Padovini, general manager of Jaguar of Troy, said the response to the new XK has been exceptional.

"People are going crazy," she said. "We expect to triple XK sales this year. It's such an exciting time for us."

Jaguar customer Keith Marchiando, chief financial officer for Dura Automotive Systems Inc. in Rochester Hills, agreed. He liked the XK so much that he bought it despite lingering concerns he had about Jaguar's brand image.

"I honestly think it's kind of in limbo," he said. "I think Ford's still trying to figure out where to position it."

But after looking at cars made by BMW, Maserati and Porsche, Marchiando decided on the Jaguar XK.

"People come up to me and just said that is just the sexiest car that I have seen," he said.

David Doyle, a 53-year-old Bloomfield Hills resident, also was having his doubts about Jaguar. Before he saw the new XK, that is. After that, his love for Jaguar was renewed, and he bought his fifth.

"I was going to bail out," he said. "From the day I was probably 15, I've always admired Jaguar ... I thought they had the best-looking sports cars."

Forward toward rebuilding

This Jaguar revival seems like news enough in its own right: It's been late in coming, and there's still a ways to go.

But there's another hook in this story: It also offers hints about the strategy, and potential, for Ford Motor Co.'s larger, more crucial Way Forward turnaround plan.

Both efforts were methodical, multiyear strategies crafted by Mark Fields, the Ford executive vice president who led Premier Automotive Group from July 2002 until October 2005.

Now, as president of Ford's Americas division, Fields heads Way Forward, which aims to revive Ford operations in North America and could make or break the 103-year-old Ford Motor Co.

That plan calls for closing 14 plants, eliminating 34,000 jobs and taking other actions to reduce costs and rebuild the Ford, Mercury and Lincoln brands.

The Jaguar plan, while similar in structure, was much smaller.

Announced in September 2004, the detailed Jaguar turnaround called for closing one of the brand's three plants, slashing jobs, getting out of Formula One racing, reviewing the company's operations and, finally, rebuilding the image and products of Jaguar.

Jaguar spent most of 2005 executing its objectives.

Fields was promoted to his current position as president of the Americas just as the Gorgeous campaign was hitting magazines and airwaves but before he could see the plan through to completion.

That caused some to criticize as mixed his performance as an automotive leader -- Fields also oversaw a turnaround at Mazda, a Ford affiliate -- and question whether he had the chops to pull Ford's North American operations out of trouble.

"When it comes to Jag, you could call him the Teflon CEO," Gordon Wangers, CEO of AMCI, an auto marketing firm based in Marina Del Ray, Calif., said.

A clear direction

But while Fields did leave Jaguar as a work in progress, many auto experts, including Wangers, concede that there's clear direction there now.

In its seven-brand portfolio, Ford now is attempting to station Jaguar between Volvo, where starting prices for the safe, upper middle-class brand top out at about $50,000, and Aston Martin, where they start at $110,000.

Jaguar won't say what its new strategy means for the future of the X-Type, which auto analysts speculate will be allowed to die.

But the new XK is crucial to launching Jaguar's return to the upper crust. The XK, starting at $75,500, bears a twin-like resemblance to the Aston Martin DB9.

In the interim, though, there are some downsides to Jaguar's move back uptown.

As the brand curtails the ambitious sales objectives it dreamed up in the days of the X-Type, sales are falling rapidly. Worldwide sales at Jaguar declined to 89,904 last year, from 118,918 in 2004. In the United States, they are down 33.5% through May.

That performance made Jaguar stand out as the worst-performing brand, by far, in Ford's portfolio. It's a lump of dishonor that Jaguar also earned in 2005.

But Jaguar officials, and dealers, said the company's new plan requires some patience.

"It is a strategy that takes time to play out," Ursomarso, the dealer, said.

O'Driscoll said the Jaguar name continues to have a lot of value and allure for consumers, regardless of what auto industry insiders might think about Ford's management of the brand.

"While it has certainly taken some knocks over the last few years, as a result of the move down market ... the brand today is in great shape and has survived a lot worse than this over its 70-plus years in the United States," he said.

He predicted that a fresh, new Jaguar will be born from this new XK and marketing campaign.

"I really believe we can make it," O'Driscoll said, "and remake Jaguar into the company that it always should have been."
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