Premium carmaker Jaguar Land Rover (JLR) sets up plant in Brazil
Brazil: Luxury
car manufacturer Jaguar Land Rover has unveiled their fully owned facility in
Brazil. The company announced an investment of USD350 million in 2013 in Brazil
for the newly opened plant when the car sales were witnessing steep decline due
to political turmoil in the country.
The move came as a result of rising interest
rates, collapsing consumer confidence and high tariffs imposed on imports when
the company decided to set up a fully owned plant in nation with a population
of 200 million and joins other leading carmakers such as Volkswagen and General
Motors in setting up manufacturing plant in the country.
“"The premium sector has more or less
held its ground, so share of total industry has grown for premium and we've
been able to robustly hold our position," said Julian Hetherington, the
project director of JLR for Brazil. Other than the Brazil plant the company has
also set up a plant in China as a part of Joint Venture with brand Chery making
the Brazilian plant as company’s first fully owned facility outside United
Kingdom.
From the new facility the company is expected
to produce 10,000 units this year for both the models Land Rover Discovery
Sport and Range Rover Evoque Sport. However, the annual capacity of the plant
is around 24,000 units when fully operational. According to the manufacturing
head of JLR Land Rover is one the prominent selling premium SUV brand in the
country and accounts for one third of the total sales in this segment.
According to a recent report published by TechSci Research, “Brazil
Tyre Market Forecast & Opportunities, 2020’’, the replacement tire segment accounted
for around 68% volume share in Brazil tire market in 2014. Moreover,
replacement demand for tires is anticipated to grow at a faster rate during
2015-2020, as compared to OEM tire demand. As a result, the market share of
replacement tire segment is expected to further increase through 2020. In 2014,
Brazil was the fourth-largest auto market across the globe after China, US and
Japan in terms of sales, and ranked seventh in terms of production. Growing
domestic demand for automobiles, increasing per capita income levels of
consumers and availability of skilled workforce have attracted significant
foreign direct investments in the country over the last decade.
TechSci
Research believes that, the company is among the leading premium carmakers
globally and by setting up a wholly owned manufacturing facility in Brazil the
company opens door for various prominent tire manufacturers for OEM tie ups.
Also with the commencement of production for the luxury SUV in the country, the
demand for tires are expected to fuel up in the country.