Jaguar Land Rover eyes boost from UK trade deals with India, US
MUMBAI: The free trade agreement between India and the UK will benefit Jaguar Land Rover’s future vehicles, as customers will be able to access them much faster, driving its performance in India, said the company’s top executive. Currently, the Range Rover franchise— Range Rover, Range Rover Sport, Evoque, and the Velar—are built in India using CKD (completely knocked down) kits. These vehicles will not be impacted by the new FTA. But future cars will benefit as customers will be able to access these global models at global prices much faster, said director PB Balaji.The FTA will cut the import duty on fully-built cars from the UK to 10% from 100%. In FY25, JLR sold 6,183 vehicles in India, setting a record for the highest number of cars sold in its 17 years of operation in the country. The UK-based company, owned by Tata Motors since June 2008, was bought for $2.3 billion. JLR made over 70% of Tata Motors’ revenue last fiscal, which was Rs 4.39 lakh crore.Regarding the US-UK trade deal, Balaji said, “The situation is much better than what we were facing before. We await the fine print in terms of timings, whether it’s applicable retrospectively or not. We also need a few clarifications in terms of what is due to auto parts and accessories.”The trade deal lowers tariffs on UK-built vehicles exported to the US to 10% from 27.5%, within a quota of one lakh cars. Any export beyond this quota will face the 27.5% tariff. The US makes up a quarter of JLR’s sales. It recently restarted shipments to the US after pausing them following the US’s 27.5% tariffs on foreign-built vehicles that came into effect on April 3.“Whatever has been shipped to the US will not have any impact if it is going to be a retrospective effect. We will continue shipping from here on. We will have to wait to quantify the impact of the change in tariffs,” Balaji said. Although the US duty is at 10%, it is still higher than the 2.5% rate that existed before April 3. The US tariff impacted Defender, one of JLR’s most sold models in the US, as it is manufactured in Nitra, Slovakia. “It faces a 27.5% tariff and we are looking at ways to mitigate the tariff impact. We remain optimistic that there will be a deal done between the EU and US as well, just like what has happened between the UK and US,” Balaji said. JLR is maintaining a “heightened vigil” on costs and cash as it navigates a challenging operating environment triggered by tariffs and geopolitical actions. It is working on multiple levers such as material and battery costs. The impact of tariffs and the actions it takes will become clearer with time, showing how they balance out, Balaji said. JLR intends to invest 18 billion pounds in the business over a five-year period.This investment will come from existing cash flows.If JLR will consider opening a manufacturing facility in the US following the trade deal, Balaji said, “We need to see how the new tariffs are playing out before we are able to take any call on that.”