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Volume needed for Jaguar Land Rover to compete with German Automakers

Volume needed for Jaguar Land Rover to compete with German Automakers

"Home for clawless cat wanted. Ford may be about to throw limping Jaguar and Land Rover to the wolves." It was European newsletter Automotive Industry Data’s cruel take four years before on rumors that Ford Motor was trying to dump its chronic British loss makers, Jaguar and Land Rover.

It absolutely was hardly surprising how the two firms had been unwanted.

Finally, Jaguar, which Ford bought for $2.5 billion in 1989 within the hope of producing its very own BMW equivalent, continued to lose its American parent a different $7.5 billion before it managed to influence Tata of India to purchase the storied sporty British brand, with its barely profitable SUV-making Land Rover compatriot included, for $2.three billion in 2008.

Jaguar Land Rover is still around, but the jury has gone out on no matter if it may survive and thrive up against the German premium maestros Mercedes, BMW and Audi." Jaguar has always depended on a sugar daddy; first it was Ford, then it was Tata," said Karel Williams professor of Manchester Business School.

Williams thinks Jaguar Land Rover is simply too tiny, and regardless of having some outstanding models, needs a lot extra volume to be able to tackle the Germans. Jaguar Land Rover's worldwide sales recently were about 240,000, with Land Rover accounts for about 80 % of this. Mercedes, Audi and BMW each sold far more than 1 million cars this past year. Audi has an additional benefit because it might use aspects of its Volkswagen parent to chop costs a lot more. This year it launched the small Audi A1, a thinly concealed version of the VW Polo city auto.

“Audi has the advantage that it shares parts with VW; hence of course the A1, basically a sales hit at almost no expense, all they have to do is dress up the VW Polo. Now I can't see how in the long run Jaguar, given this massive contrast of scale, can recover its costs of production and development of the next model," said Williams.