Jaguar Land Rover finds it difficult to raise interest rates, says it could hurt demand
Jaguar Land Rover said in a report that interest rate hikes by central banks globally are expected to increase financing costs for consumers and could affect future demand.
The UK-based marquee brand, which aims to become a fully electric battery supplier in the next two years, also points out that high inflation rates are exacerbated by the Ukraine conflict, energy prices high rise and supply disruption after Covid as well as other negative factors.
“Rising interest rates in 2022 (including UK, US and Europe) will affect financing costs for consumers and could impact future demand,” the umbrella maker said. said in its Interim Report for the third quarter.
The company is working to offset inflationary trends and other issues such as high energy prices through actions to improve profitability.
The Tata Motors-owned carmaker said that while limitations remain, chip supplies are expected to continue to improve gradually.
“Partnership agreements in place with major chip suppliers are providing greater visibility into short-term supply,” it said.
In an analyst call, JLR Interim CEO Adrian Mardell said the company plans to roll out all-new all-electric Jaguar products starting in 2025, followed by products. Range Rover and Defender.
With a transition period looming, the company expects investments to peak in the next 18 months.
“Within two years we will have a fully electrified Range Rover BEV (battery electric vehicle). Now it’s only two years away,” Mardell announced.
“So within two years most of our vehicles will have all-electric offerings, and that will be complete in all models by the end of the decade,” he notes.
The company estimates 60 percent of its sales will then accrue from BEV versions.
Mardell said the automaker aims to have zero emissions from the tailpipe by 2036 and zero carbon emissions by the end of that decade.
“So our electrified future continues at a pace and the investments we’re currently making will grow in that direction for at least the next 12 to 18 months,” he added.
JLR’s revenue hit £6 billion in the third quarter, up 28% year-on-year reflecting favorable volumes, model combinations and other factors.
Date of first publication: February 6, 2023, 10:45am IST