Jaguar Land Rover on Friday (11 December) confirmed it would be the first British carmaker to open a factory in Slovakia.
The plant will manufacture a range of new aluminium Jaguar Land Rover vehicles. First cars are expected off line late in 2018. The factory will have initial capacity of 150,000 and construction starts next year.
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Other automakers have car factories in the eastern European country, including Hyundai Motor group’s Kia, which builds models such as the Venga, Sportage and C’eed in Zilina, and the Volkswagen group which makes Audi Q7 and Volkswagen Touareg large SUVs and the Up/Citogo/Mii city car model lines for several group brands in Bratislava.
JLR said its long-awaited confirmation followed an agreement between the automaker and the Slovak Republic government to build a new plant in the city of Nitra, in the west of the country. The GBP1bn (US$1.5bn) “premium manufacturing facility” will, eventually, employ around 2,800 people.
JLR recently said it would double spending on its engine new plant in Wolverhampton, England, to almost GBP1bn – which it claimed was “the largest injection into a new British manufacturing plant in decades”, creating several hundred new jobs. The automaker previously redeveloped part of the historic ‘original’ Land Rover plant at Solihull, West Midlands, to build an assembly plant for the Jaguar XE line. It has also set up a Range Rover Evoque vehicle and engine manufacturing joint venture in China and a KD kit assembly factory in Brazil, complementing an assembly plant set up earlier by parent Tata Motors in Pune, India.
Land Rovers are assembled in Malaysia, in very low volume, and there have been rumours recently JLR is considering an ASEAN plant in either Thailand or Malaysia where high import tariffs are imposed on built-up cars. Local assembly would reduce retail prices and boost volumes from a few hundred a year at present to an estimated 3,000-5,000 for the region, sufficient volume to make the business case for a KD plant. Some BMW and Mercedes models are assembled under contract at locally owned factories in Malaysia so a local plant would make the British cars more competitive with their German rivals.
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By GlobalDataJLR CEO Ralf Speth said: “The new Slovakian factory will complement our existing facilities in the UK, China, India and Brazil and marks the next step in the company’s strategy to become a truly global business.
JLR said Slovakia has an established premium automotive sector which accounts for 43% of the country’s overall industry. It has more than 300 suppliers in close proximity and an excellent logistics infrastructure; “this confirmed our decision that this country was the ideal location”.
Apparently anticipating UK union concern, the automaker added: “The heart of our company will always be in the UK, where our design, technology and manufacturing capabilities are based. It is our creativity and innovation which makes Jaguar Land Rover the leading boutique automotive brand, offering exceptional products for our customers.
“The creation of new international plants allows Jaguar Land Rover to offer its customers even more exciting new models, protect against currency fluctuations and create a globally competitive business.”
JLR’s announcement follows the signing of an agreement by Speth and Slovakian prime minister Robert Fico in Bratislava.
Fico said: “We are glad that Jaguar Land Rover has chosen Slovakia for its new world-class manufacturing facility. This decision shows that, with a stable and solid business environment, [our country] is an attractive place for investors. And the marriage of Slovak craftsmanship and British engineering holds great promise.”
The automaker said it chose Slovakia after “robust analysis of a number of locations around the world including other European countries, United States and Mexico”.
