Jaguar Land Rover announces EV pivot in major strategy revamp
- Electric vehicles will form 60% of Land Rover’s annual sales by 2030 and the company expects to stop sales of combustion engine vehicles by 2036
- Sales of the company’s luxury cars in China jumped by 19% on a corresponding basis as the economy seems to have recovered significantly
New Delhi: Jaguar Land Rover – the luxury passenger vehicle making arm of Tata Motors Ltd – on Monday announced a new global strategy, Reimagine, wherein the company will take a giant leap towards manufacturing of electric vehicles and aim to achieve double digit operating margins – earnings before interest and taxes (EBIT) – from its operations worldwide.
As part of the strategy, the British carmaker will reposition and redesign Jaguar as an all electric luxury car brand by 2025 and Land Rover will also evolve as a manufacturer of luxury electric sports utility vehicles globally, as part of this strategy.
Electric vehicles will form 60% of Land Rover’s annual sales by 2030 and the company expects to stop sales of combustion engine vehicles by 2036 as part of JLR’s overall aims to become ‘net zero carbon business’ (carbon neutral) by 2039.
According to Thierry Bolloré, chief executive officer, Jaguar Land Rover, the company has designed a strategy that will provide a clear road map for both Jaguar and Land Rover, and overall the company will become more agile with a more simplified manufacturing operations and improve synergies with other companies of the Tata Group in different aspects of future mobility.
“We will re-imagine Jaguar as a pure luxury electric vehicle brand with a new portfolio of emotive designs and next generation technologies. We will reinforce Land Rover’s leading in luxury SUV segment with the purity of electrification. Two brands, two distinct personalities, connected by the elements of quality and sustainability that underpin Jaguar Land Rover’s future of modern luxury by design,” added Bolore.
In addition to betting big on battery electric technology, the British car maker will also invest significantly on development of hydrogen fuel cell technology driven electric cars and then will start testing these vehicles in the UK within the next one year. Amongst vehicle makers, Japan’s Toyota Motor Corp and South Korea’s Hyundai Motor Co have invested heavily on hydrogen fuel cell technology as an ultimate replacement to lithium-ion battery driven electric vehicles.
Over the last few years, Jaguar Land Rover has been witnessing decline in sales of its vehicles in key markets like China, Europe and United States, as result of slowdown in global economy, introduction of stricter emission norms and shift in customer preference towards electric vehicles. The covid-19 pandemic compounded the problems faced by Britain’s biggest car maker.
The company introduced a major cost saving programme, known as Project Charge to improve cash flows and improve profitability.
JLR also said that annual commitments of circa £2.5bn will include investments in electrification technologies and the development of connected services to enhance the journey and experiences of customers, alongside data-centric technologies that will further improve their ownership ecosystem.
The statement also mentioned that ‘Reimagine’ will see Jaguar Land Rover ‘right-size, repurpose and reorganise’ into a more agile operation. To accelerate this efficiency of focus, the company will substantially reduce and rationalise its nonmanufacturing infrastructure in the UK.
Jaguar Land Rover’s luxury passenger vehicle sales declined by 9% year-on-year to 128,500 units during the December quarter, but on a month-on-month basis sales improved by 13% as vehicle sales picked up in China. Sales of the company’s luxury cars in China jumped by 19% on a corresponding basis as the economy seems to have recovered significantly compared to some of the other developed markets.
JLR’s net sales declined by 6.5% to 6 billion pounds but its profit before tax improved by 38% to 439 million pounds as result of an improvement from its cost cutting efforts. It’s EBIT (earnings before interest and tax) margins also expanded by 400 basis points to 6.7%.
“The Reimagine strategy takes Jaguar Land Rover on a significant path of acceleration in harmony with the vision and sustainability priorities of the wider Tata Group. Together, we will help Jaguar realise its potential, reinforce Land Rover’s timeless appeal and collectively become a symbol of a truly responsible business for its customers, society and the planet,” said N Chandrasekaran, Chairman of Tata Sons.
Source: livemint
