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Jaguar, Land Rover adopt strategy of fuel efficiency

Phil Popham, Director, Group Sales Operations, Jaguar Land Rover, outside the Park Hyatt Hotel in Toronto on May 25, 2012.

Peter Power/The Globe and Mail/Peter Power/The Globe and Mail

Fuel economy isn't the first thing that pops into mind in any discussion of Jaguar and Land Rover. But it's becoming increasingly important – even for two automotive brands that usually stand for speed and ruggedness.

Speed and performance are still front and centre, but it's unusual to hear senior executives introduce the topics of weight reduction and smaller engines as Phil Popham, director of group sales operations for Jaguar Land Rover worldwide, and Lindsay Duffield, president of Jaguar Land Rover Canada, did in an interview.

"Everything's got a weight dimension to it," Mr. Popham said. That includes not just the several hundred pounds cut from the weight of the cars and sport utilities by using aluminum in underbody components, but also reducing the weight of the motors that drive power seats and virtually every other component.

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"That allows you to put smaller engines in," he said.

Those smaller engines are six-cylinder and four-cylinder power plants that will be offered along with the traditional V8. The four-cylinder will be the lightest engine yet put in a Jaguar.

The new engines will come out of a new £350-million ($560-million) factory the auto maker is building in its home territory in the Midlands in Britain.

They're part of a strategy to diversify the company from its traditional dependence on its home market, North America and Western Europe and capitalize on emerging markets such as China, India and Brazil. That growth will depend on the success of new vehicles such as the new F-type roadster, which will arrive in 2013 and will be the first car in which the new six-cylinder engine will be available.

The company wants to expand in new areas so that by 2020 each of five different regions will contribute 20 per cent of the company's profit, Mr. Popham said.

The plan includes manufacturing in India, where Jaguar Land Rover's parent company, Tata Motors Ltd., owned by Indian entrepreneur Ratan Tata, is based. Tata bought the company from Ford Motor Co. for £1.5-billion in 2008.

In China, where Mr. Popham expects sales to hit 60,000 vehicles this year and challenge the U.S. and U.K. for sales leadership, assembly will be done in a joint venture with Chery Automobile Co. Ltd.

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While the company wants to grow, "we have no aspirations to be a volume business," Mr. Popham said. "It's not our history and it's not our expertise."

The two brands combined sold 4,000 vehicles in Canada last year at 25 dealerships.

Mr. Duffield said his vision is to hit sales of 10,000 with as many as 30 dealers by the end of the decade.

"That's a really good business for us and our dealers," he said.

He said he's receiving calls regularly from dealers who don't operate Jaguar Land Rover outlets asking about openings.

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About the Author
Auto and Steel Industry Reporter

Greg Keenan has covered the automotive and steel industries for The Globe and Mail since 1995. He also writes about broader manufacturing trends. He is a graduate of the University of Toronto and of the University of Western Ontario School of Journalism. More

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