Tata-owned Jaguar Land Rover (JLR) is planning to reduce its manufacturing capacity by a quarter over a five-year period to 2027 as part of its latest strategic plan under new CEO Thierry Bollore.
The UK-based premium carmaker also said in a presentation to investors that it has reduced its breakeven point from c.600,000 units pa to c.400,000 units, helped by some GBP6bn of cash and profit improvements under ‘project charge’.
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The company also reported an ‘encouraging turnaround’ in China, despite Covid, and said there has been a significant improvement in China business and quality of sales.
Under the ‘reimagine’ strategy, the company is aiming for investment at GBP2.5bn a year and positive cashflow from FY2022/23. By FY2025/26 JLR is targeting an EBIT margin of over 10% compared with around 4% (underlying) in this fiscal year.
There will also be a one-time writedown of GBP1bn this quarter as a result of scrapped projects (such as the XJ).
JLR is planning an electrified future under the new ‘reimagine’ strategy which includes a new dedicated engineering architecture for BEVs. As well as Jaguar becoming an all-electric brand from 2025, it is planned that Land Rover will welcome six pure electric variants over the next five years.
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By GlobalDataThe company wants all Land Rover models to be available in pure electric form by end of the decade and the first all-electric Land Rover model is planned for launch in 2024. By the end of the decade, in addition to 100% of Jaguar sales, it is anticipated that around 60% of Land Rovers sold will be equipped with zero tailpipe powertrains.
