The news that JLR is to open its first manufacturing plant outside the UK is hardly unexpected - as regular MT’ers will know, JLR is doing rather well at the moment. Its cars - Range Rovers and the new Evoque in particular - are selling like hot cakes in the developing economies of Asia and South America. And there’s an all-new big daddy Range Rover on the cards too, demand for which is also expected to be high.
But it will be seen by some industry watchers here as possibly the thin end of the wedge, the first sign that the future for the company - whose Britishness is a key piece of its brand identity - does not lie in an entirely UK manufactured product.
The commercial logic is to go where the markets are is strong, however, and JLR CEO Ralf Speth was keen to point out the firm’s commitment to the UK. ‘We are increasing production’ he said, ‘not to reduce it in the UK, but using the UK base to grow around the world.’ It’s also true that the firm has invested very heavily in its existing three UK factories. But this news could signal that any further expansion of manufacturing in this country by JLR is unlikely.
The firm already assembles Freelanders in Pune, India, using parts shipped from the UK, and the original Land Rover Defender is screwed together in several locations around the world, including Kenya. But the Chinese factory - a joint venture with Chery Automobile - will be the first true manufacturing plant outside the UK, using Chinese parts.
Last year JLR sold 314,000 vehicles, 29% more than in the previous 12 months. JLR had also intended to open a similar factory on Brazil, but has shelved the idea due to regulatory and tax hurdles there.