VZCZCXRO4368
PP RUEHROV
DE RUEHKH #0089 0221307
ZNR UUUUU ZZH
P 221307Z JAN 07
FM AMEMBASSY KHARTOUM
TO RUEHC/SECSTATE WASHDC PRIORITY 5850
INFO RUCNIAD/IGAD COLLECTIVE
RUEATRS/DEPARTMENT OF TREASURY WASHDC
RUCPDOC/USDOC WASHDC

UNCLAS KHARTOUM 000089 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
DEPT FOR AF/SPG, AF/EPS, EB/IFD, AND EB/ESC 
DEPT PLS PASS TO USAID FOR AFR 
TREASURY FOR OFAC 
USDOC FOR ANESA 
 
E.O. 12958:  N/A 
TAGS: BEXP BTIO ETTC ECON EAID PREL SU
SUBJECT: Termination of Land Rover Operations Creating 
Difficulties for Company and Customers 
 
¶1.  (U) This is an action request - see para 6. 
¶2.  (SBU) Summary:  Land Rover has been ordered by Ford Motor 
Company to close down all commercial operations in Sudan. 
Representatives of Land Rover here believe this action was taken as 
a result of pressure from the U.S. Government.  The shut down is 
creating a "horrendous" situation of liabilities and contract 
problems with customers, according to local sources.  Customers 
affected by the closure include the British Embassy and several 
humanitarian agencies.  Sudan had been the largest market in 
sub-Saharan Africa, outside of South Africa, for Land Rover. 
Embassy requests Washington guidance on possible measures to reduce 
impact on humanitarian agencies or permit the shut down of sales and 
service to be less abrupt.  End summary. 
 
¶3.  (SBU) On January 21, Duncan Thomas and Norman Dunkerley met with 
Econ Officer.  Dunkerley is technical advisor to Awab Motors, the 
local Land Rover agent.  Thomas is the Executive Director of AES 
Support, a UK-based firm engaged in automobile distribution in 
several African countries.  Thomas and Dunkerley stated that Land 
Rover has recently received instructions from Ford Motors, which 
owns Land Rover, to shut down sales and service operations in Sudan. 
 They explained that this will pose a "complete and utter nightmare" 
for their businesses, and will create a "horrendous" tangle of 
liabilities and breaches of contract with customers. Thomas noted 
that Land Rover is a UK company, and its vehicles are not U.S. 
sourced.  They had asked for a meeting at the Embassy because they 
believed the order to cease operations from Ford was a result of 
pressure from the USG, specifically from the SEC, on Ford. However, 
visiting AF/SPG Deputy Director Small suggested that the decision 
might be a result of pressure on U.S. companies to divest from 
Sudan. 
 
¶4.  (SBU) Thomas noted that Sudan is the largest market in 
sub-Saharan Africa, outside of South Africa, for Land Rover.  Sales 
for 2006 were about 500 vehicles and projected sales for 2007 were 
600 to 1000.  Customers include the British Embassy and humanitarian 
NGOs, such as Oxfam, Save the Children, and Mines Advisory Group. 
Some of the NGOs are implementing partners for USAID.  Under the 
instructions to shut down operations, vehicles already ordered will 
not be delivered, spare parts will no longer be sold, and warranties 
will not be honored. 
 
¶5.  (SBU) Thomas and Dunkerley arrived at the meeting at the Embassy 
well briefed on U.S. sanctions.  They had copies of the executive 
order imposing sanctions, and noted that, under the terms of that 
order, U.S. firms were allowed six months to shut down existing 
operations in Sudan.  Based on their assumption that the shut down 
came as a result of U.S. Government regulations, they asked if a 
similar six-month phase out period would be possible for Land Rover. 
 They also asked if any exemptions could be provided for sales to 
the British Embassy or humanitarian agencies.  Econ Officer advised 
that if the closing of operations were based on sanctions 
regulations, then an application for a license through the 
Department of Treasury, Office of Foreign Assets Control (OFAC), 
might be an option that Ford should consider. 
 
¶6.  (SBU) Action requested:  Embassy requests any information 
Washington has on the reason for Ford's decision to shut down Land 
Rover operations in Sudan.  If the shut down is due to sanctions, 
please advise if a six-month phase out or license for sales to 
humanitarian agencies might be feasible. 
 
HUME