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The combined pensions liability of Jaguar and Land Rover stood at less than £200 million last year, Autocar has learned. That figure has continued to decrease this year, and contrary to reports published today in the Financial Times, is nowhere near large enough to significantly outweigh the value of the sale of either company for parent Ford.
Motor industry tongues began wagging this morning when a report in Financial Times suggested that all of the £950 million likely to be raised by Ford for the sale of both Jaguar and Land Rover would be spent filling the companies’ pensions fund shortfall. In other words, it suggested, Ford will have to pay whoever clinches the deal to take the brands off its hands.
A spokesman for Ford and PAG told Autocar earlier today that wasn’t the case. “Jaguar and Land Rover’s pension funds are maintained independently; both are healthy and performing well.”
“When we published account statements last year, Jaguar’s fund was £150 million in defecit, and Land Rover’s £49 million in defecit. Those figures add up to significantly less than the figure that has been reported today."
Two bidders have emerged at the lead of the race to buy the brands; Tata Motors’ bid, in conjuction with Mahindra and Mahindra, and a bid from the private equity group One Equity Partners, the latter bid headed up by former Ford boss Jac Nasser.
Ford has entered ‘detailed negotiations’ with these companies, with the aim of completing the sale before the end of the year. It is not likely to sell all of both companies, but instead to keep minority stakes.
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