Long-expected Indian assembly of Land Rovers has begun. Mumbai-based Tata Motors opened its first local factory on Friday on the outskirts of Pune, building the Freelander 2 from CKD kits shipped from England.
Production of Jaguars is expected to begin at the plant later, news agency AFP reported from India.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
Analysts have said the move will help Jaguar and Land Rover lower costs and become more competitive in India – the world’s fastest-growing major car market – where rivals BMW, Daimler and Audi are already well-established.
All have local assembly, essential to avoid high import duty on assembled vehicles which makes retail pricing uncompetitve with locally-built rivals.
The Freelander 2 is offered in India in two variants, TD4 SE and a higher-spec HSE version, both diesels with automatic transmission.
“We are very optimistic about Jaguar Land Rover in terms of volume growth,” JLR’s chief executive Ralf Speth told a news conference in Mumbai after reporting a 25% rise in annual unit sales to 243,621 [and a healthy fiscal year profit, both for JLR and parent Tata Motors.
Under Ford ownership, JLR lost US$15bn in two years and, in 2007, sold just 65,500 cars, AFP noted.
The new Indian plant has raised questions about production at the three JLR plants in Britain – Solihull [once notorious for poor industrial relations], Castle Bromwich and Halewood [ditto]. Tata Group chairman Ratan Tata was recently embroiled in a row about the work ethic of British managers.
He told The Times that “nobody is willing to go the extra mile” at the company or British steel maker Corus, acquired by Tata in 2006. Corus has just announced a round of job cuts at one of its plants.
The company later told AFP he was talking about former managers and was not suggesting they were lazy.
Tata Motors sells Jaguar XJ, XF and XK models in India in addition to Land Rover’s Discovery and Range Rover SUVs. All are currently imported complete.
Tata Motors chief executive Carl-Peter Forster has said that India was a “huge market with immense potential” and sees it as a key target for growth along with with China, where demand for Jaguar and Land Rovers rocketed last year. Jaguar is launching a special three-litre petrol V6, long wheelbase XJ for China, adding extra rear seat features like heated and cooled seats with massage system, targeting the country’s large chauffeur-drive market.
JLR is also starting to customise its cars to meet Indian needs, local spokesman Del Sehmar told AFP, offering more space and rear seat comfort because, like China, most luxury cars in India are chauffeur-driven.
Sehmar said the company sees India as a “second home market” after Britain, with a rosy future.
On Thursday, Forster indicated that India could also become an option for making engines in the future.
Mahantesh Sabarad, from Fortune Equity Brokers in Mumbai, told AFP Jaguar Land Rover still had work to do to implant itself in the mind of the Indian consumer, despite improved sales.
“The company has to make its cars more attractive, not by dropping prices but boosting appeal and value through better branding and improved features,” he told AFP.
