Tata Motors has stepped up research and development funding on premium brands Jaguar and Land Rover, promising over 30 new offerings including new products, variants and face-lifts over the next three-five years.
The Mumbai-based company, which owns the two UK-based brands, has doubled the spending on capital expenditure and product development plan to £1.5-6 billion per year from about £800 million per year spent in the last four-five years.
Some of the new products targeted at launch are the all-new Defender, a sports car model from Jaguar, a smaller executive sedan under Jaguar competing against the BMW 3 series and Mercedes C Class, a convertible SUV, hybrid variants to name a few.
Jaguar Land Rover Chief Financial Officer Kenneth Gregor, said, "We have got something like 30 plus product enhancements or new products, product derivatives, engine derivatives or replacements planned for the next three-five years, there is a lot of product traction happening.”
From next generation Range Rovers, JLR is migrating towards region specific models such as that for China, the second single-biggest market for the two brands after the US. The Dragon nation accounted for 16.3 per cent sales in the last nine months as against 10.5 per cent in the same period previous year.
According to reports, the company is seeking regulatory nod to set up a joint venture with China's Cherry Automobile Company, which would make Land Rover and Jaguar models. In addition to the existing range, JLR will produce China-oriented products, which would be tuned to please the local buyers.
JLR already has an operational assembly plant in India, at Chakan, near Pune, where it makes the Freelander 2 model, built under the Land Rover brand. It plans to add more models in the future, including Jaguar models.
China and Russia, over the last one year, have emerged as the growth areas for JLR which is a departure from its traditional markets such as Europe, UK and the US, which are battling slowing economy growths.
Volumes in China during the nine months have nearly doubled to 35,275 units, as against 18,636 units sold in the corresponding period last year. Sales in the UK and the US have largely stayed flat for JLR.
"The auto market of China has been through a period of amazing growth for the last couple of years. Most market commentators are expecting the growth rate of China market as a whole to moderate a bit, single-digit growth for the industry as a whole broadly in line with GDPs, probably the central bank forecast for 2012. Within that I think there is an expectation that the premium segments might grow faster, might be double digit mid-teens sort of growth rates,” Gregor added.
Tata Motors officials have said the priority for them is investing the proceeds of JLR back into the business for expanding production facilities in its home market in the UK and overseas, developing new products and hiring of fresh engineers to name a few. The company is in the process of inducting 1,000 fresh engineers to scale up product development.
