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Expert Comment: The Rebirth of Jaguar-Land Rover

Jaguar Wednesday 19 June 2013

Rob Glynn, Professional Network Co-ordinator at Liverpool Hope, looks at the unique public appeal of the Jaguar.

Recently, in a crowded room at the Paris Motor Show, a Jaguar was born. Prowling low to the ground and making its first growl with menacing intent, onlookers were aghast at what had been created. In a glittering haze of laser beams, dancers and flashing camera phones, the latest addition to the Jaguar-Land Rover family had been given its world premiere. It was the new Jaguar F-Type, the company’s fresh take on a small, two-seater convertible. Aesthetically so beautiful it caused many car enthusiasts to faint, the F-Type has capped off an amazing couple of years for JLR.

Soon, the carmaker is to create an additional seven-hundred jobs in the UK, thanks to the decision to expand its already substantial engine plant in the West Midlands. At the same time, it has publicised its intention to invest £2.75billion on further product development – a great deal of which will involve collaboration with UK-based universities and engineering consultants. The nearby factory in Halewood is working literally 24-7 and the company is fast becoming one of the country’s most influential graduate employers. This comes at a time when many of Europe’s largest car manufacturers are still heavily mired in debt. In industry terms then, JLR is in the midst of a quite dazzling boom – whether in terms of sales, output or that lovely pearl of business that escapes so many; public adoration.

But what are the reasons for this?

Crucially, in the case of both Jaguar and Land Rover, the companies have long held a considerable degree of brand appeal across the world (especially here in the UK). Yet until recently, their products have lagged behind fierce competition; many of their past models having suffered reliability issues or poor standards of build quality – especially when compared to German rivals such as BMW, Mercedes-Benz or Audi. To a great extent, these problems were attributable to the fact that Ford (who owned JLR until 2007) encouraged corners to be cut in the name of cost-saving, even allowing some Jaguars to share parts with Ford’s own budget models.

Fortunately, all that changed when JLR was bought by TATA, the Indian metals giant; a move that many British business advocates condemned as representing the loss of a valuable home-grown brand to overseas investors. In the press, scaremongering spread about the prospects of TATA re-locating factories to India for the sake of cheaper labour. But none of this has held true. With deeper pockets from which to plunge, JLR began to invest heavily again in product improvement, employing one of the best car designers in the industry (Ian Callum, a design god in car terms) to breathe life into their whole range. Suddenly, Jaguars and Land Rovers began to look, drive and feel great again, making consumers twist around in their Audis and pay attention.

In the space of about five years, Jaguar and Land Rover have launched several award-winning products that would be considered outright blockbusters in the film industry. Jaguar’s new XK, XF and XJ models are stripping market share from their rivals with the admirable ferocity, while Land Rover’s latest futuristic Evoque model – made in Liverpool – is currently the most in-demand car across the world, with an almost year-long waiting list. Many car connoisseurs scoffed when Victoria Beckham was supposedly drafted in to act as a “design consultant” for the Evoque, in a whirlwind of PR hysteria. On the contrary though, the campaign turned out to be a marketing triumph, making young, affluent females take notice of the brand, thereby broadening Land Rover’s appeal in a very masculine market.

Speaking of broadening appeal, it could be argued that the best decision JLR ever made was to expand its outreach globally; especially into emerging markets. The company has signed a deal to collaborate with Chery (a Chinese carmaker) in exchange for improved distribution of JLR products across China. Similarly, the cars are gaining an ever-increasing presence in India, thanks in large to parent company TATA’s influence there. These represent just two advances the organisation had made in embracing the much-debated globalisation movement – both in regard to markets and industries. In the past, JLR was very much UK-centric and allergic to radical change – afraid to veer from stale, retrospective design and open itself up to the world. What it has realised of late is that consumers’ tastes in cars (and their ability to buy them) are beginning to converge across continents. In other words, a sales success in one market will likely be a success in others; at least in the case of automobiles.

Having a worldwide consumer base to draw upon is helping JLR to offset instabilities in certain markets; not least in Europe, where it would have died a prolonged death if it had remained dependant on custom there. Nonetheless, the company’s European sales have not suffered too badly as a result of the way in which Jaguar and Land Rover have been positioned. Carmakers at extreme ends of the price spectrum are faring the best amid the Eurozone crisis, such as Kia and Hyundai at the value end and JLR at the luxury point. By far the worst off are those left lingering in the middle, such as Peugeot-Citroën, which has had to make a series of mass redundancies in France due to reduced continental demand.

What JLR’s success story provides is proof for organisations in any industry that foreign ownership is not always a double-edged sword – providing an injection of investment on the one hand, but outsourcing domestic jobs on the other. In tandem with having a global consumer base (with the dispersion of risk that such a strategy affords) and a parent company that truly understands and respects the heritage of its acquisition, a company can flourish. JLR, like a great deal of other companies, has a brand image immersed in traditional British strengths and values; such as craftsmanship, sporting prowess and understated reserve. What TATA is doing is providing all the foreign direct investment and global access JLR needs, but not interfering in that place-related image by allowing its design and engineering departments to remain based in the UK.

Indeed, both Jaguar and Land Rover provide fine examples of how cold-blooded products can transcend their physical properties to become objects of national pride, personal expression and status. Just as novels are about far more than words on a page, so cars can represent far more than dreary machines – something JLR seems to have embraced with its latest offerings; especially the F-Type. Much of what we associate with certain cars is likely to be subjective; a result of our own experiences, personalities and awareness of a company’s heritage. For that reason, JLR cannot afford to presume that everyone in the country holds the same deep-rooted affection for its products. However, the British public tends to lend great support to home-grown underdogs, which could help it to sustain its mercurial rise well into the future – a rise built on most of the factors mentioned here.

Next time you are driving, look out for big cats in your mirror.

 

 

 

 

 

Image: Jaguar. Photo by Jason Goulding. http://www.flickr.com/photos/14373548@N03/8718783537/in/photolist-ehs3A6-a8kaQs-a8hjnv-8iyt1A-eFxWjC-eFxVwb-dugvMu-9WSadn-8QfPzb-8Tz7Ch-8Tz659-9g57BG-9g573G-9g1Zgt-9g21ye-9g56FN-9g212M-9WV2jq-8Uhuk8-eFxXcA-eugaAj-8Zxtkq-doyz6B-8vMAm6-bnWLzA-8AwCvT-d9Xww9-7GMev6-dQENr2-cm1a57-9RaAB6-8t3RJ7-aC8s6C-esSLXP-esSNcP-esW2ry-esW2R3-esW2nu-esSLw4-esSMkT-esW1e1-esW2AS-esW1D3-esW1Tj-7Un62X-7UqkaC-7Un5Vz-bTXWY2-bTXWUZ-bF4cPA-bTXX1a/lightbox/ Licensed under CC BY-ND

 

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