Jaguar Land Rover outlines future; new small SUV

Like every automaker on the planet, Jaguar Land Rover has been hit hard by the global recession. But today, the British company, owned of India’s Tata Motors, laid out an ambitious plan to secure its future, including a new, small Land Rover SUV.

Of course, there’s lots of jargon in the announcement about “efficiencies,” “competitive structures,” and “responding to climate change,” but perhaps most telling is the frankness with which Jaguar Land Rover describes its current situation:

“The car industry has been through an unprecedented recession. New car sales, including those of Jaguar and Land Rover, are down globally by 25-30 percent. This has resulted in manufacturing capacity utilization of less than 60 percent at Jaguar Land Rover.”

“The company has already responded with aggressive actions over the past year. Production was reduced by more than 100,000 units; spending and costs were cut; employment reduced by 2500; and pay frozen and bonuses cancelled. But this was not enough to offset the full magnitude of the downturn and the company swung from profit in 2007 to significant losses over the past 12 months. This was not a sustainable situation. Actions taken have started to reverse the trend quarter over quarter and we now have to take the company to the next level of competitiveness.”

Hats off to Jaguar Land Rover for being so honest.

Its new plan beings rolling out over the next 12-18 months as markets recover. On the product side, both brands will expand into new segments. Jaguar Land Rover promises lightweight sedans, sports cars and premium SUVs, with hybrid and electric drive to “significantly” reduce fuel consumption and CO2. Some £800 million has been dedicated to environmental innovations.

One of the first products out of the gate will be a new, small Land Rover, based on the LRX concept that debuted at the 2008 Detroit Auto Show. Designed, engineered and built in England, it will be the smallest, lightest and most efficient vehicle the company has ever produced and will be sold in over 100 countries. The LRX debuts next year and joins the line-up in 2011.

On the business front, Jaguar Land Rover says it will tune-up its cost competitiveness by benchmarking, if not beating, the levels achieved by its rivals.

Simplifying the engineering of it vehicles (probably through more shared components), will see it transfer manufacturing from two plants to one by the middle of the next decade.

Growth in emerging markets like China will also factor into Jaguar Land Rover return to profitability.