Jaguar Land Rover set for new plant in Saudi Arabia?

THE owner of Jaguar Land Rover is said to be exploring the possibility of setting up a new manufacturing facility in Saudi Arabia.

If such a development did take place it would extend the firm’s global reach even further following assembly agreements in India, a new joint venture plant in China and a standalone factory in Brazil – the latter announced at the tail end of last year.

There has been no official announcement but sources in India – home of JLR owner Tata Motors – said the parent company was looking at options for the new plant in Saudi Arabia.

The Times of India cites a statement by the Gulf kingdom’s industry minister when addressing an India-Saudi Arabia Business Forum meeting.

Tawfig Fawzan Alrabiah, the Saudi Arabian commerce and industry minister, is quoted as saying the proposed plant would involve the manufacture of both Jaguar and Land Rover models.

He said the factory would probably be sited somewhere in the eastern province of Saudi Arabia.

Alrabiah is also quoted as saying said other Tata companies including Tata Consultancy Services (TCS) and Tata Steel were also looking at the kingdom for potential expansion.

The speculation regarding JLR is not without substance.

In 2012, JLR announced it had signed a letter of intent with authorities in Saudi Arabia which would see the two parties work on a detailed feasibility study to determine the viability of setting up an automotive facility.  The agreement was signed by Azzam Yaser Shalabi, president of the National Industrial Clusters Development Program (NICDP) Saudi Arabia and JLR chief executive Ralf Speth.

JLR said then that the discussions were at a preliminary stage, although opportunities had already been identified in aluminium component production.

This latter factor is significant given JLR’s push to develop a new generation of all aluminium bodies. The new Range and Range Rover Sport are built using the technique, manufactured at a special bodyshop at the Lode Lane plant in Solihull.

Jaguar’s new small saloon, due out next year, is also to be built using the process and additional facilities are being introduced at the Solihull plant to cope with production volumes.

However, if JLR is looking to manufacture the new car in massive quantities so it can rival the likes of BMW then it will need additional capacity.

Saudi Arabia is also home to the world’s largest integrated aluminium complex, a joint venture between Saudi Arabian Mining Company and Alcoa of the US. Production is due to begin this year at the Ras Al Khair facility, creating potential opportunities for the automotive sector.

With JLR also having control over its own engine supply for the new car, courtesy of its i54 plant, then the strategy could suggest the model will be produced in very significant numbers.