JLR set to reveal record profits in excess of £1bn
JAGUAR Land Rover is set to reveal record profits in excess of £1bn, signalling the car maker’s remarkable turnaround since its acquisition by India’s Tata Motors.
It could also herald a massive round of investment that could see the development of a new engine plant in the West Midlands.
Reports suggest the firm’s annual profits for the year to March 31, 2011 could be around the £1.1bn mark. The figure is in stark contrast to two years ago when the firm appealed for a Government loan as it recorded a loss of £281m in its first 10 months of Tata ownership.
Although UK sales continue to decline, the firm is selling vehicles in markets such as China and India as never before and is currently working hard to meet demand.
It has implemented a Land Rover assembly operation in India and is planning to enter into a joint venture with a China-based manufacturer as quickly as possible so it can meet demand there.
The domestic plants will also enable the company to beat crippling import duties which currently make the vehicles about three times more expensive than in the UK.
Nevertheless, such is the demand for vehicles from China’s emerging middle classes and others that the vehicles are continuing to sell in record numbers.
With the Range Rover Evoque on the horizon and a clutch of new models from Jaguar expected before too much longer, then the demand is expected to continue.
This latter fact could be crucial to the firm’s decision earlier this year to retain its two West Midland plants.
While it is also this demand which has prompted speculation the company is about to announce plans for a new engine plant, with the i54 site outside Wolverhampton thought to be the front runner.
Tata originally paid Ford £1.15bn to acquire the two marques from the US company’s Premier Automotive Group in 2008.
Many within the industry scoffed at the deal, claiming the price had been inflated. However, the deal now looks to have been remarkably prudent.
The famous brand made a net profit of around £730m by the end of last year and the growth has continued.
The renewed confidence surrounding the company was also underlined earlier this month with the announcement it is to build 250 of its hybrid supercar, the C-X75 in collaboration with the Williams Formula 1 team.
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