Indian-Owned British Automaker Records £1.5 Billion (US$2.3 Billion) Pre-Tax Profits
Apparently, fierce competition with BMW, Audi, Mercedes-Benz and other luxury automakers in China hasn’t been too much of an issue for Indian-owned Jaguar Land Rover (JLR), which only three years ago almost resorted to a government bailout. According to company stats released this week, booming demand in China and other emerging economies helped Jaguar Land Rover achieve record annual sales, with pre-tax profits rising 35 percent to £1.5 billion (US$2.3 billion). The company noted today in a release that it sold 314,433 cars in the year as of March 31, a 29 percent increase year-over-year, with its Range Rover Sport leading sales, followed by the newer Evoque — the Victoria Beckham edition of which made a splash at this year’s Beijing International Auto Show. As for Jaguar, its best-selling model this year has been the Jaguar XF.
Though observers are closely watching China’s auto market this year to see if the record growth rates seen in recent years show a marked slowdown, JLR’s results indicate that — for the first quarter of the year, at least — demand remains high in the luxury sector despite a slump in the mass segment. China is currently JLR’s third-largest market, and this year recorded an impressive 76 percent increase in sales to over 50,000 units. To put that in perspective, JLR’s fourth-largest market, Russia, recorded a 38 percent increase in sales to around 16,000 units. Leading markets the UK and US recorded respective sales of 60,000 units and 58,000 units.
JLR’s results cap off a string of good results from British auto marques. Led by growing demand for luxury brands in emerging economies, the UK car industry produced 1.3 million vehicles in 2011, a six percent increase over 2010. As Mark Fulthorpe, an analyst at IHS, told the Guardian this week, the Range Rover and Land Rover brands in particular are outperforming competitors in old and new markets, adding, “These are positive signs because they are growing their presence in emerging markets and they are proving to have a sustainable business for their vehicles in some of their mature markets.”
Impressive China sales don’t mean JLR can expect an easy ride in the country, however. In China’s booming luxury SUV segment, Range Rover’s competition is only set to become more intense in the years ahead, with Aston Martin expected to revive its Lagonda SUV by 2014, Bentley recently debuting its EXP 9 F “Falcon”, and Lamborghini eying wealthy drivers in China and Russia with its URUS SUV.