Jaguar and Land Rover are to be sold to Indian car giant Tata, it has been reported.

US giant Ford is set to announce that Tata Motors will take over Land Rover and Jaguar, which has a plant at Halewood, in a deal worth around £1 billion and which will safeguard about 16,000 jobs.

Industry sources last night confirmed a deal had been agreed.

But a Ford spokesman said he could not comment until the car company's employees had been notified of any "significant developments".

Tata, which already runs the former British Steel company Corus, has been in talks with Ford for some months.

Earlier this year, the Indian car giant unveiled the world's cheapest new car, the Tata Nano, which will cost just £1,250.

The deal is likely to include a commitment from the Indian company to preserve the style of Land Rover and Jaguar.

Based in Solihull in the West Midlands and celebrating its 60th anniversary this year, Land Rover has proved a profitable part of Ford's empire since the American company took it over in 2000.

Land Rover's first model was the vehicle that bore the company's name and many of the early models are still in working order. Other famous models have included the Range Rover, the Freelander and the Discovery.

As a company name, Jaguar, which cannot match Land Rover's current profitability, dates from 1945 and also has a plant in Castle Bromwich, West Midlands. Famous models have included the Jaguar E-type and the long-running Jaguar XJ series.

The sale is expected to be welcomed by unions as the best deal to be had. Tata has already spoken of its commitment to the two marques and to UK motoring.

Last year, Ford sold British sportscar maker Aston Martin to a consortium led by Prodrive boss, David Richards for £479 million.