While rising costs and tough economic times continue to put pressure on UK car manufacturers in their home market, rising demand for luxury automobiles among the Chinese and Indian middle classes sees the emergence of new battlegrounds in Asia.
Long considered the preserve of largely western middle and upper classes, the luxury car has, for much of the past century, carried clear and visible weight as a status symbol outstripping its value as a functional commodity. In recent decades, however, the profitability of many high end automobile brands has experienced freefall with many of the most prominant marques of yesteryear changing hands as manufacturers have been forced out of business. With the economic turmoil of recent years compounding problems, this downward trend in the European and American markets seems set to last for the forseeable future.
When Indian manufacturing giant Tata purchased the classic British Jaguar Land Rover marque from Ford in 2008, the brand was suffering from plumeting revenue streams, and appeared to be a losing concern with the price of purchase an estimated $2.65bn – approximately half of the sum Ford had paid to aquire rights to produce under the name a few short years earlier.
Within three years however, the Jaguar Land Rover brand was posting record profits of more than £1bn, as global sales incresed by 26%. By targeting Indian and Chinese middle classes comprised of increasingly wealthy entreupenuers and business people, Tata has been able to boost sales of high value automobiles produced under the JLR marque. Celebrity endorsed campaigns featuring Victoria Beckham have established the high end Range Rover Evoque, along with other models, as a highly desirable commodity with to the point where demand outstips supply. Sales in China have grown at an astonishing 91% year on year, with JLR fast establishing itself as a trophy brand among Chinese elites.
This change of fortune for the brand, who’s cars are still produced at a number of plants in the north of England, represents one of the most remarkable comebacks for British industry in recent years. One thousand new jobs have recently been created as the Merseyside facility has expanded to round the clock production to meet demand from China and India.