This shift underscores JLR’s commitment to local manufacturing and tapping into India’s growing luxury car market, a top company executive told Mint in an interview, on the sidelines of the inauguration of the Range Rover House in Alibuag, Maharashtra, the first experiential centre of the brand in India.
A new assembly line for the Range Rover and Range Rover Sport will be set up in Tata Motors’ manufacturing facility in Pune, Maharashtra, with a production capacity of 10,000 units annually in two shifts.
The move is expected to reduce prices by a significant 18%-22%, while still keeping them in the ₹1.5 crore and above category, said Rajan Amba, managing director and CEO of Jaguar Land Rover India.
“(W)e believe customers who were hesitant will make that leap, and it should add to the growth in Range Rover and Range Rover Sport,” said Amba.
“This is the first time that these flagship brands are coming out of Sollihul (in the UK) are being made anywhere else. This is a reflection of JLR’s commitment to India and the power of consumerism in this country, especially at the premium end,” he said.
The local assembly aims to attract a new set of buyers and expand the brand’s footprint in India.
“We can produce world class quality in India – and that’s the reason we can produce the Range Rover and Range Rover Sport here as well. The team in Pune ensures really high quality. With the local manufacturing opportunity here, we can really play into the opportunity (of customers seeking premium, customised products,” said Lennard Hoornik, chief commercial officer, JLR.
The new assembly line will commence operations soon. By the end of May, India-assembled Range Rovers will be available for delivery, while the Range Rover Sport will hit the market by the middle of August, Amba said.
Rising demand and luxury market growth
India’s luxury car market, led by German carmakers Mercedes Benz, BMW, and Audi, collectively totals close to 50,000 units annually. Mercedes Benz holds nearly half the share of this market.
However, JLR, a more niche luxury carmaker with higher average prices, is poised to capitalize on the growing ₹1.5 crore and above category.
For instance, Mercedes Benz derives a quarter of its sales from top-end vehicles priced over ₹1.5 crore. JLR anticipates the Indian luxury car market to double to 100,000 units in the next five years.
“So, there is a lot of headroom to grow here. We are seeing a slightly younger trend of customers – even if they are not the buyers, they are influencing the purchase decisions,” Amba noted.
“We are putting the products in a price band that hopefully compels people sitting on the fence to buy. Over the next one year, we also hope to bring down waiting periods which go up to 12 months.”
Order book and prospects
Jaguar Land Rover has witnessed robust growth, with sales increasing by 82% last year and order book rising 60%.
“Our sales grew 82% last year, 90% in terms of revenue, 160% for Range Rover, and 70% for the Range Rover Sport brand. The repositioning we have done with the Reimagine strategy and modern luxury is bearing fruit,” said Amba.
JLR reported ₹4,000 crore in revenue from the Indian market in fiscal year 2024 (FY24), with total sales at 4,500 units – a tad shy of the 2018 record of 4,596 vehicles.
The British carmaker expects to surpass luxury market growth in FY25, and Amba is optimistic about maintaining a strong order bank, which will enable further investments in customer experiences and product categories.
“The first couple of months of the fiscal are going pretty well”, he said.
JLR already assembles several models locally in India, including the Range Rover Velar, Evoque, Discovery Sport, and Jaguar F-Pace, at its Pune plant. These vehicles are supplied as completely knocked down (CKD) kits from the UK.
With the inclusion of the Range Rover and Range Rover Sport, JLR’s portfolio in India is now almost entirely locally assembled, except for bespoke and SV models, which will continue to be imported.
JLR India market focus
For now, the India-made Range Rovers will only serve the domestic market. Amba explained, “When we do CKD assembly, we get the advantage of not having to pay high duty, which lets us pass on the benefit to our customers, our dealers, and ourselves. With this price reduction, we will be able to start touching segments previously put off by high prices.”
“I want to express my gratitude to the vision of Ratan Tata, who brought JLR to India 15 years ago…Manufacturing the Range Rovers in India should send a signal about how serious we are about the Indian market,” said N. Chandrasekaran, chairman, Tata Group.
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Published: 24 May 2024, 01:58 PM IST