Jaguar’s enduring challenges are somewhat obscured by the company letterhead’s more successful name: Land Rover may come second in JLR, but its SUVs bear the brunt of the load. Jaguar Land Rover achieved record-breaking global sales of 621,000 units last year, with a US record of roughly 114,000 vehicles; however, about 75,000 of those American sales were from Land Rover. Jaguar did experience a 27% increase here, approaching 40,000 units, after a remarkable 116% surge in 2016. However, almost all these gains can be attributed to the aforementioned F-Pace. Disregard the “percentage” increases and consider the broader picture: A sole Mercedes SUV, the GLC-Class, found nearly 48,000 buyers in 2017, a number eclipsing the total sales of all Jaguar models combined.
“Excluding SUV purchases, Jaguar only managed to sell a mere 741 cars in October. Porsche outperformed Jaguar’s entire vehicle range with its 911 sales figures.”
The situation has worsened in 2018. Jaguar is on track to sell less than 30,000 cars in the US this year, currently down by 28%. Despite America’s fervent love for SUVs, even the F-Pace is finding limited admiration, with a 27% decrease year over year. While Land Rover celebrated its most successful October in history, the entire Jaguar lineup only attracted 2,648 buyers last month. Out of those, around 1,900 were due to the F-Pace and the recently introduced E-Pace SUV. Subtracting these sales, Jaguar only managed to sell 741 cars in total. To put this into perspective, four models—the XE, XF, and XJ sedans, and the F-Type sports car— each had an average of fewer than 200 sales. This included 78 XJ sedans purchased by Americans—few enough to commend individually for their unique taste in flagship sedans—along with 171 for the XF and 186 for the diverse range of F-Type coupes and convertibles. Porsche outsold Jaguar’s entire vehicle lineup with its 789 units of the 911 sports car.
Even with the most budget-friendly Jaguar XE seeing a 306-unit sales dip last month, it’s essential to re-evaluate the significant gamble that Jaguar took in 2015 with this BMW 3 Series competitor: Some analysts, perhaps overly optimistic, projected that Jaguar might achieve annual XE sales as high as 200,000 worldwide. Even conservative estimates hovered around 100,000. The XE has never come close to meeting even these more pessimistic forecasts, its commendable performance overshadowed by a cramped rear seating area, an economy-focused interior, and the ongoing downfall of the sedan market. Even BMW is grappling with declining interest for its once-popular 3 Series, with sales plummeting by approximately 30% in recent years—a worrying sign for Jaguar’s revamped XE scheduled for 2020. The smaller, more affordable E-Pace, Jaguar’s new SUV, is also facing sluggish sales on showroom floors.
At this juncture, even the influence of big brother Land Rover may not be sufficient to shield the fragile Jaguar sibling. This is due to other unfavorable outcomes within JLR, partly caused by external circumstances, unfortunate timing, and sheer misfortune, creating what some insiders refer to as a “perfect storm.” This includes the expensive endeavor of developing diesel engines and models—just as Volkswagen tainted the air and market with its Dieselgate scandal, leading governments and regulatory bodies worldwide to deem diesel as Public Health Enemy No. 1. Are concerns regarding diesel emissions exaggerated? Undoubtedly, but that offers little solace to companies like JLR. Struggling to find buyers for a Jaguar XE, whether in Los Angeles or London? How about a diesel XE instead, mate? Presently, you’d have an easier time offloading used Hummers at a Jerry Brown rally.
Both brands under JLR might encounter more adverse publicity compared to any car manufacturer from the imminent Brexit of the U.K., which could lead to potential decline in sales, employment, and domestic investment. The company has already cautioned that an unfavorable Brexit agreement could result in a £1.2 billion annual profit loss. A “no deal” Brexit scenario, where the U.K. exits the European Union without an agreed-upon deal, could particularly jeopardize the local JLR production or necessitate a move to the European mainland, where JLR presently manufactures SUVs in Slovakia. The uncertain nature of Brexit, coupled with declining diesel sales in the U.K. and Europe, has prompted JLR to implement a shortened three-day work week at Castle Bromwich—a site that was previously a Spitfire factory producing Jaguar sedans and the F-Type—lasting until Christmas.
Additionally, a significant decrease in sales in JLR’s key Chinese market—caused by trade tensions with President Trump affecting Chinese consumer confidence—has temporarily halted production at the plant in Solihull, U.K., where the popular SUV models, including the F-Pace, Range Rover, and Land Rover Discovery, are manufactured.
So, what’s the status quo with Jaguar, apart from the global strategic maneuvers and classic car models being compromised? It appears that a significant number of Americans have lost interest in—or don’t feel a personal attachment to—classic, sporty, and historic brands like Jaguar, Alfa Romeo, Lotus, and Maserati, especially when considering new showroom vehicles. Tesla stands out as the visionary automaker of the 21st Century, enticing affluent buyers to explore something innovative and unique. Well-established luxury brands, from Mercedes to Lexus, capture the rest of the market. The competition for luxury sales is fierce, and some brands may not survive, despite the hopes of car enthusiasts. While I’m not implying that Jaguar will face this fate yet, selling just 306 units monthly of their most affordable model doesn’t seem sustainable, no matter how many Land Rover SUVs they sell to compensate for Jaguar’s performance.
JLR appears to recognize the need for a change in direction. With the uncertain future of diesel, the company is placing a billion-dollar bet on electric power: Ralf Speth, JLR’s CEO, announced that by 2020, every model from Jaguar and Land Rover will offer an electrified version, be it a mild hybrid, plug-in, or fully electric vehicle. I have already experienced driving the 2019 Jaguar I-Pace electric SUV. The I-Pace is a remarkable electric vehicle—visually appealing, enjoyable to drive, offering a legitimate 240-mile range, and priced at $70,495, which is $10,200 less than the cheapest Tesla Model X. Even Google’s Waymo expressed interest, enlisting up to 20,000 I-Paces for their expanding autonomous test fleet. Although the I-Pace has just entered the market, with only five units sold in October, it’s a promising start. If justice prevails in the automotive industry, Jaguar will witness a substantial increase in sales in the upcoming months, beyond just Waymo. If that plan falls short, it’s uncertain what other strategies Jaguar could explore—reader suggestions are appreciated. Perhaps they could consider removing the iconic Jaguar Leapers and Growlers at the factory, replacing them with Land Rover and Range Rover emblems, hoping for a positive outcome.
Lawrence Ulrich is The Drive‘s Chief Auto Critic. Follow him at @lawrenceulrich.
