Global sales up 16% in Q1 for Jaguar Land Rover

THE need for today’s car manufacturers to continue with their massive investment programmes in order to sustain their global competitive edge has been thrown into sharp focus with Jaguar Land Rover’s first quarter results.

The Midland carmaker reported a 16% increase in vehicle sales to 173,743 during the three-month period to June 30, 2016 compared with a year ago.

On the face of it, a very creditable performance.

However, pre-tax profit levels declined to £399m from the £638m figure achieved a year ago.

However, to claim performance is disappointing is churlish.

The past year has seen investment in new models, staffing levels and production facilities as the company looks to maintain its bid to be a global player alongside the likes of fierce rival BMW.

The opening of its new plant in Brazil, expansion of its engine manufacturing facility in Wolverhampton and a new plant in Slovakia all form part of the recent investment programme.

On the model front, Jaguar’s stock has never been higher with the XE finding a new market for the company and its presence has now been supported with the launch of the marque’s first crossover, the F-Pace – already the company’s fastest selling model.

The company is hoping the investment will see a new sales surge over the medium term, especially with Brexit and the fall in the pound making its products cheaper for foreign buyers.

Sales in Q1 were up across all regions. The twin Jaguar additions saw the brand’s retail sales increase by 76% to 31,800 vehicles.

Land Rover also saw retail sales in the quarter grow by 4%, exceeding 100,000 vehicles for the first time, led by continued strong demand for the Land Rover Discovery Sport, with strong showings from the Range Rover Evoque and Sport.

There was double-digit retail growth in China, North America, Europe and the UK.   

Dr Ralf Speth, JLR CEO, said: “This quarter’s sales results reflect the positive customer response to the introduction of new vehicles, such as the Jaguar XE in America. We have delivered volume growth in all of our major markets and remain solidly profitable.”

Revenue topped out at £5.461bn, up from £5bn in the same quarter last year. EBITDA was £672m (12.3% margin).

The company said in its results statement: “The operating performance in the quarter reflects overall higher wholesales, offset by adverse FX impact of £207m including revaluation of £84m, mainly euro payables resulting from depreciation in the pound. EBITDA margin excluding the FX revaluation was around 14%.”

Close