LOS ANGELES -- How bad are things at Ford Motor Co.'s British luxury brands? Perhaps worse than you think.
Jaguar, Land Rover and Aston Martin lost more than $800 million combined during the first half of 2004, according to an analysis of financial documents.
Ford was counting on $500 million to $600 million in profits from its Premier Automotive Group luxury division this year. But only Volvo Car Corp. among the four PAG brands is making money.
Ford doesn't break out results for individual brands. But Volvo sources confirm reports that the Swedish carmaker earned $488 million in first-half operating profits.
Meanwhile, Ford reported that PAG lost $342 million overall in the first half. That means the struggling British brands lost $830 million in the first half of 2004.
"You can't assume that we can continue at this rate," says Ford Motor Co. President Nick Scheele.
For all of 2003, PAG posted a pretax profit of $164 million, compared with a loss of $740 million in 2002.
Ford says PAG lost $362 million in the second quarter of this year, compared with a profit of $166 million in the second quarter of last year. CFO Don Leclair says the luxury group would be lucky to break even this year.
The Swedish business newspaper Dagens Industri estimates that Volvo earned $335 million in first-quarter operating profits and $153 million in the second quarter. Volvo sources don't dispute the estimates. Dagens Industri obtained its estimates by analyzing Volvo's filings with Swedish tax authorities.
PAG boss Mark Fields declines to talk about the financial performance of specific brands, though he says Volvo is "doing well."
In an e-mail message, Fields said PAG has suffered from "unfavorable exchange, higher costs, the effects of the significant model changeover at Land Rover, unfavorable mix and lower net pricing."
"We are accelerating our plans to address the deterioration we have seen, particularly at Jaguar," he said.