Foreign firms have always been keen on buying what they perceive as Landmark companies and properties that belong to the US, only to lose their shirts later. I'm not just talking about Diamler paying $2 Billion to rid itself of Chrysler or The Japanese with Pebble Beach and Rockefeller Center. The recent acquisitions such as the sovereign wealth fund of China losing $600 million on Blackstone, or Lenovo's absent profits from its purchase of IBM's PC division, prove that the foreign companies are not that good at valuing American assets they buy. Instead of getting a perceived discount, they are the ones who get ripped off instead. Thus, for any protectionists out there, they should instead embrace the trend of new foreign overlords and allow them to take over our money-losing operations. Their infusion of cash through these purchases can only benefit our economy in the long run, as it keeps businesses that would otherwise be shuttered or significantly downsized from collapsing.

This comes close to capturing the reality of the situation. From a shareholder's perspective, the sale of Jaguar makes sense if there is a buyer that values the marque more than Ford does. Sales of this type can occur even when the subsidiary is enormously profitable and the parent is not (witness GM's sale of Hughes). Actual profitability is, in fact, unimportant to the raw calculation here.

This being the case, a Chinese or Indian buyer is likely to value these luxury brands more so than Western or Japanese manufacturers, because companies in these upstart nations are able to buy a prestige that they cannot, at this time, organically create. Toyota was able to create Lexus, because Japan was a respected creator of goods at the time. Tata cannot create its own equivalent brand, because India is not recognized for quality manufacturing. China is in an even worse spot as it is know primarily for producing the world's lowest quality goods. So they must buy and overpay for the prestige factor.

The interesting thread here is that Jaguar is not, in fact, an American invention. After ruining the cachet of their own Lincoln brand, Ford's corner-cutting did the same to a British marque. For example, it is nearly impossible to make a V-6 sound as good or rev as smoothly as Jaguar's traditional inline sixes, and Ford definitely didn't go to the trouble.

So, here it is Ford losing its corporate shirt trying to buy overseas cachet and reform it in their own image. What's bad for us is bad for them, too. Corporate homogenization is very akin to a city man's affection for the dog. To quote E.D. Worley, "Great benefits are anticipated at the outset. Few concretely appear."

The Indians could turn it into a good investment, provided they remember that "it's the product, stupid." Only the product can maintain the cachet in the end. I personally think that India making a go of the British cat would be a fascinating bit of reverse colonialism. It would certainly be a hard lesson for the ingrown fatcats of the more established corporation!