Tata Motors’ UK-based luxury vehicle unit Jaguar Land Rover (JLR) could soon be building vehicles in Saudi Arabia, possibly using locally-sourced aluminium components.
The automaker has signed a letter of intent with the kingdom’s National Industrial Clusters Development Programme (NICDP) and a feasibility study is now under way to decide if full vehicle manufacture there is viable.
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UK reports suggested the company may start with assembly from kits shipped from England, a method used to build Land Rover models overseas for decades, with more complex manufacture to follow once local workers have gained experience.
JLR recently announced a joint venture with Chery Automobile to build, rather than just assemble, Jaguar and Land Rover models in China. Parent Tata assembles Freelanders at a recently expanded plant in Pune.
The automaker said Saudi Prince Faisal Bin Turki bin Abdul Azi Al Saud and his government want to develop an automotive industry.
JLR CEO Ralf Speth said: “We are committed to further international partnerships to meet record demand for our highly sought after vehicles. [Saudi Arabia] is an attractive potential development option, complementing our existing advanced facilities in Britain and recent manufacturing plans to expand in other countries including India and China.”
Discussions are at a preliminary stage and include local aluminium parts production – JLR is well experienced with building alloy vehicles.
The world’s largest integrated aluminium complex, a joint venture between Saudi Arabian Mining Company and Alcoa, is due to begin production in 2014 in Ras Al Khair creating potential opportunities for the automotive sector.
JLR sales in emerging markets are rising – global sales rose 32% year on year to 324,184 vehicles in the 11 months to 30 November. Middle East and North Africa volume was up about 9% to 11,418 units.
JLR hopes to announce further plans in 2013.
“Issues such as level of investment, potential capacity and job creation have not yet been discussed in detail between the parties,” it said in a statement.
“This is an exciting project that could enable Jaguar Land Rover to establish a JV partnership in a part of the world where luxury vehicle sales are expected to rise.” added Speth.
“If we proceed, it will complement our existing expansion in the UK and elsewhere.”
