Jaguar Land Rover is eyeing sustainable, profitable growth

Article by Anita Panait, on October 15, 2013

Although Jaguar Land Rover asserted that it does not intend to become a volume carmaker like BMW, there are indications that the United Kingdom-based carmaker is heading in that direction. JLR group sales director Phil Popham told Automotive News Europe at the Frankfurt motor show in September that the carmaker has an aggressive business plan, saying that the group is growing and is investing heavily.

Popham remarked that “it has to be sustainable, profitable growth,” but said the carmaker has no “aspirations to be a volume manufacturer." However, for Popham, volume means over a million vehicles annually.

However, JLR's chief executive in Canada, Lindsay Duffield, remarked in June that the carmaker seeks to reach an output of 750,000 units a year by 2020, with a plan to build a million vehicles annually in the future. Looking at JLR’s recent performance, the goal of 750,000 units by 2020 could be called a conservative figure.  Combined sales of the Jaguar and Land Rover brands in 2012 reached 358,000 vehicles.

To achieve its 2020 target, JLR needs to grow annually by nearly 10 percent. Since JLR’s current growth outpaces that requirement, analysts suggest that the carmaker could achieve its target at a sooner date. Bernstein Research Senior Analyst Max Warburton in a recent report, remarked that JLR's growth in the last two years “has already been spectacular,” and they expect its growth to continue at a “far faster pace than most are anticipating."

For the first eight months of 2013, Jaguar and Land Rover logged a 38-percent and a 12-percent surge in sales, respectively. Combined, Jaguar and Land Rover recorded a 16-percent rise in sales in the first eight of 2013. JLR is also making good progress in China, where it posted a 112-percent jump in sales in the first eight months of this year. JLR is expecting to further hike its sales in China as it commences output at a Changsu site owned by a joint venture with Chery Automobile in late 2014. [source: automotive news - sub. required]

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