Tata may start producing luxury cars in India
JAGUAR LAND ROVER owner Tata Motors could be ready to start production of the vehicles in its Indian homeland to help it meet growing demand for the luxury vehicles.
The move is not unexpected following Tata’s recent statements that it plans expansion of the twin marques throughout Asia.
Sales of the both the brands – Land Rover in particular – have been strong in recent months and demand for both is growing in India and China.
In its quarterly statement, Tata said: “The Jaguar Land Rover business continued to show strong profitability, with increase in volumes coupled with significantly favourable currency movement in Q1 FY2010-11, reporting a profit before tax of £233.82m. With the positive market reception of the enhanced product range in an improved market environment as well as continued cost reduction efforts, the business was able to show sustained quarter on quarter improvement towards solid profitability in the quarter.”
The company sold 57,153 vehicles during the period compared to 35,947 units in the same quarter last year, with demand especially strong for Land Rover and the Jaguar XJ.
Tata said there had been a strong recovery across all the regions, with China standing out, registering a growth of 104%.
Tata already plans to produce parts in China and the plans for India will also help it boost domestic sales.
In its annual report last week, Tata said it planned a number of changes to the Jaguar model range including a BMW 3-Series style entry level model, a new estate and a roadster, while it also said plans were proceeding to refresh the entire Land Rover/Range Rover range.
While the Indian move will be a blow to UK manufacturing – the firm employs around 3,000 people at Halewood, near Liverpool – it does make business sense.
Such is the demand for the vehicles at the moment that Tata is struggling to cope. Suppliers are having difficulty keeping up and there are reports that Tata is working with former owner Ford to keep up the supply of engines.
JLR’s latest results mark the best period for the company since Tata took it over from Ford in 2008 and follow a loss of £60m in the same quarter last year.
The results have also boosted Tata’s overall performance – with the parent company announcing profits of £273m for the quarter ending June.
It is not just the direct manufacturers who are benefiting. Pendragon, which sells the vehicles through its Stratstone dealership network, yesterday singled out the brands for the impact they had had in boosting its own profits.
