Jaguar is hoping the snob value — exclusive premium luxury offering — will do the trick in India.
Tata Motors is actually quite lucky. The $2.3 billion that the company paid to acquire Jaguar and Land Rover from Ford may look a bit hefty in today’s depressed times, but it’s unfair to look at the automotive industry on a year-on-year basis. The industry is unique because car makers have to think and act today to make the kind of cars people will drive half a decade down the line and sometimes even more.
Yes, automakers have to see the future and as everyone knows, it’s not an easy task. The reason Tata is lucky is because the Indian auto giant is now reaping the harvest from the seeds sown by Ford. With the Blue Oval’s backing, Jaguar pushed the boundaries to create two superlative cars that overturned established benchmarks set by their contemporary rivals across the Atlantic. The XK coupe/convertible was launched in 2006 while the XF sedan was introduced in 2007.
But barely had the two cars begun paying off their investments back to Ford that Jaguar was sold to Tata Motors. And it is not just two great cars that have been handed over to Tata on a platter, but the forthcoming XJ luxury saloon as well, which promises to take the rejuvenated Jaguar further ahead.
But will the Indian luxury car customer be swayed away from the German trio comprising Mercedes-Benz, BMW and Audi and go out and buy himself a Jaguar? After all, the Germans have been around longer, possess well-established distribution and service networks and a portfolio of different models and a host of engine options. Besides, when you say “luxury cars” in India, the association is inevitably German. So where does that leave the hallowed British marque? “Our effort in the first phase is to establish the brand appropriately rather than focus on pushing volumes,” says Rohit Suri, head of the Premier Car Division of Tata Motors.
Frankly, that’s the only way forward for Jaguar at the moment. The only place in India right now you can buy a Jaguar officially is from their showroom in Mumbai. And they don’t have too much of a choice for the time being; only the XF, XFR and the XKR are being sold and all of them run on petrol. India loves diesels, and Jaguar has a fine 3.0-litre V6 oil-burner in their international portfolio, but that will take some time as it is still being adapted for India. Getting the diesel quickly is all the more important considering that the XF is expected to be the mainstay for the Jaguar range in India, which will bring in the numbers.
Hopefully for Jaguar, the products will do the talking. The XF/XFR competes with the Mercedes-Benz E-Class, BMW 5 Series and the Audi A6, and each of them comes with its unique strengths (comfort, driving pleasure and technology respectively). So where will Jaguar fit in? “Jaguar stands for ‘beautiful fast cars’ and the XF/XK range embodies that philosophy,” says Suri. But you need more than beauty and performance to woo the Indian customer. So Jaguar’s hoping
that snob value will do the trick. “Jaguar will be an exclusive premium luxury offering compared to other mainstream luxury offerings which are being manufactured in India,” says Suri.
The competition, however, is unfazed. “From our market experience in India as well as global trends, we can safely say that the entry of new players in this marketspace will result in increasing the size of the luxury car market in India. This is a welcome development for all players. We also realise that there is significant pent-up demand in the Indian market which makes India a market with significant future potential,” says Wilfried Aulbur, MD & CEO, Mercedes-Benz India.
Across the globe, the three Germans are acknowledged competitors for the XF, but in India, the Leaping Cat is trying to distance itself from them. And that’s more out of limited options rather than choice. That’s because the cars have to be imported from the UK (the forbidding pound-sterling versus rupee equation!) vis-a-vis the Germans who assemble their cars in India. No wonder then that even the cheapest XF is priced at Rs 62.5 lakh ex-showroom Mumbai, when the three Germans retail in the Rs 37 to 46 lakh range. The Jaguar may have a V8 engine and other luxurious bobs and bits, but that price tag is still pretty steep.
What can however help Jaguar establish its premium appeal is when they introduce the flagship XJ saloon in the country and hope the trickle-down effect will work on the XF. Jaguar’s S-Class/7 Series/A8 competitor is being unveiled this week internationally and it will go on sale in India early next year.
Meanwhile, the support structure for selling Jaguars is being put in place, and Tata Motors hopes to set up showrooms in Delhi, Bangalore, Chennai, Hyderabad and Pune by 2010. Suri says that establishing a dealership network is the biggest challenge for Jaguar in India. But that’s for the short term.
The bigger challenge for Jaguar is to sustain its premium pricing and convince customers it’s a cut above the Teutons. Perhaps its quintessential Britishness, seductive looks, thoroughbred performance and quality craftsmanship will help. And perhaps a little bit of Tata Motors’ luck as well.
