Jaguar Land Rover Leans on U.S. Amid China Slump, Brexit Turmoil
(Bloomberg) -- Jaguar Land Rover is facing stiff headwinds in the U.K. and in China, the world’s largest car market, but the storied British automaker sees the U.S. as a relative oasis.
Plummeting China sales, Brexit tremors and tightening European emissions rules forced JLR parent Tata Motors Ltd. to take a record $3.9 billion writedown last year. But while global deliveries fell 4.6 percent, the premium automaker’s 2018 sales in the U.S. rose 7.3 percent to a record of almost 123,000 vehicles.
JLR’s top executive in the U.S. is aiming for a repeat performance this year.
“If we can keep our volumes around where we were last year, I’d be more than happy,” Joe Eberhardt, head of the company’s North America business, said in an interview at the New York auto show last week. “We focus on the things we can control.”
The U.S. is JLR’s single biggest market, and it’s betting on continued demand for SUVs like the compact E-Pace and redesigned Range Rover Evoque, even as industrywide vehicle sales are expected to dip. The automaker also is counting on a new version of the Land Rover Defender, the boxy classic that ferried British soldiers during the Korean War, to gin up sales when it arrives on U.S. shores in 2020.
“There’s always room for further growth and the growth will have to come from new product,” Eberhardt said.
Maintaining that momentum in the U.S. is critical as the company struggles to adjust to falling sales elsewhere. In January, JLR announced plans to slash 4,500 jobs worldwide -- roughly 10 percent of its workforce -- as part of a 2.5 billion-pound ($3.2 billion) push to reduce costs and boost cash flow through 2020. Eberhardt said North America has done its part to contribute to cost savings, without elaborating.
Tata is said to be exploring strategic options for Jaguar Land Rover, including a potential stake sale in the struggling luxury carmaker, Bloomberg reported in March, citing people familiar with the matter. The automaker needs to raise $1 billion in 14 months to replace maturing bonds and is also burning cash on an investment program for electric cars.
©2019 Bloomberg L.P.