Storied British luxury sports sedan, sports car and SUV maker Jaguar’s future is on the line as its Indian owners, Tata Motors, huddle to decide how the coronavirus-devastated company, along with its siblings at Land Rover, can survive and thrive when the dust settles.
Tata Motors need to decide what to do with its loss-making JLR subsidiary. JLR lost 422 million pounds ($525 million) before tax in the year ended March 31, after losing 3.6 billion pounds ($4.5 billion) in the 2019 financial year. (Jaguar’s numbers are not revealed). So JLR has been in financial trouble for some time, and fallout from the coronavirus crisis will have brought the need for existential decisions to a head.
Tata Motors said in mid-June, action will be decided in a few weeks, so that suggests the news will break before August.
Industry experts reckon the Land Rover arm of Jaguar Land Rover (JLR) could use some rationalization as it fights its way out of a self-imposed diesel-dead end, but its brand power has allowed great success against world class opposition from Germany’s BMW, Mercedes and Audi, and Japan’s Lexus.
Diesel power, with its superior fuel economy and smooth power delivery, had seemed the ideal solution for big SUVs and sport sedans. Until “dieselgate” that is, when Volkswagen was discovered covering up pollution levels in 2015, and diesels fell out of favor. Until 2018, over 90% of Land Rover’s output was still powered by diesel
Both Jaguar and Land Rover use too many so-called “platforms” and these need to be drastically cut to slash costs and shorten development times. “Platforms” are the basic engineering needed to make a vehicle. In times past, each car would have had its own components, from city minicar to family runabout to wagon to top of the range high-speed cruiser. Now even the biggest manufacturers use two or sometimes three basic “platforms” which can be the basics of say, a city car, a small SUV and a sports car. Companies like VW used this across multiple brands as well.