Jaguar Land Rover's high-gear adaptability paying dividends

British premium automaker Jaguar Land Rover is generating better-than-expected financial performance while seamlessly forging a long-term strategy for the e-mobility era.

Statistics show the company's revenues for the financial year 2023(April 2022 to March 2023) soared 25 percent year-on-year to 22.8 billion pounds ($28.2 billion) and its free cash flow for the financial year was 521 million pounds, with a positive operating margin (earning before interest and taxes) of 2.4 percent compared to negative cash flow and EBIT in the financial year 2022.

Jaguar Land Rover's performance in the fourth quarter was extraordinary, with wholesales reaching 94,649 units — up 19 percent compared to the previous quarter (ending Dec 31 2022) and 24 percent compared to the same quarter a year ago.

"When China is winning, the globe is winning," emphasized Tim Howard, chief financial officer of Jaguar Land Rover China.

China is one of Jaguar Land Rover's most important markets, and fourth quarter deliveries in the country soared by 17 percent year-on-year.

Howard said China has a "significant" role to play in the company's global business, adding that its profit in the Chinese market for the financial year 2023 was double the figure of five years ago. "We are back in the game," he added.

Jaguar Land Rover is optimistic about its global business performance, with about 200,000 orders on schedule to be delivered by the end of this quarter. Of that total, 76 percent are for Range Rover, Range Rover Sport and Defender, a clear sign of clients' enthusiasm with the automaker's iconic heritage and models.

The company said it is targeting increased wholesales through the year in order to achieve EBIT margins of over 6 percent in the financial year 2024 despite lingering supply challenges and macro risks. Investment spending is expected to increase to about 3 billion pounds in the fiscal year while free cash flow is expected to be over 2 billion pounds.

Howard said Jaguar Land Rover is ramping up its pace to stay uniquely competitive in China, the world's largest and fastest-changing market.

"We have to stay ahead of changes in China. What was a dream three years ago is already reality today," he said, referring to the growing popularity of electric vehicles in the country and all the state-of-the-art technologies, including autonomous driving.

Jaguar Land Rover has its own roadmap, which will reposition the company as an electric-first modern luxury automaker by 2030, when all nameplates will offer BEV variants.

Howard said the Range Rover BEV will be launched in 2024 and the first of three reimagined modern luxury Jaguars will be an electric four-door GT to be unveiled in 2024.With more power output than any previous Jaguar, its range is up to 700 kilometers.

Jaguar Land Rover has been expanding its team of engineers in China to work on applications that meet the increasingly demanding requirements of tech-savvy premium car customers.

According to Howard, the company's China contingent is working closely with local technology companies, including chipmaker EcarX, charging network operator StarCharge and Alibaba Cloud on topics like cloud computing.

He said what the team is accomplishing is of global significance for the company because new developments in the Chinese market can later become trends in other markets.

While electrification is blurring the features of many brands, Howard said Jaguar Land Rover would remain true to its heritage and stand out as it has in the age of gasoline vehicles.

"We will never lose history. History is there," said Howard, "Our DNA can be seen in our forthcoming models." He said a new uniqueness is essential for the company's success in this age of mobility that features electrification.

"We will maintain our DNA while still delivering satisfying surprises in our new products," Howard added, citing the example that 76 percent of the current 200,000 orders on its books are for Range Rover, Range Rover Sport and Defender models. That is testament to the automaker's "House of Brands "approach, which aims to amplify the unique character of each of its offerings: Range Rover, Defender, Discovery and Jaguar.

Howard, who had planned to stay no more than two years when he left the United Kingdom for Shanghai, has now lived in China for seven years. He said he is excited about the market.

"I now see China as my home; this is where it is happening," said Howard, whose Chinese name is Han Shaoshuai, which literally means "promising marshal".

Born and raised in the UK, he prefers to dress in the traditional British style but has added some fashionable Shanghai brands to his wardrobe.

Howard's enthusiasm for the country encompasses much more than elements of oriental aesthetics. He is deeply involved in corporate responsibility projects, including those that Jaguar Land Rover has activated in China's less developed regions. At a primary school that the company helped build in Yunnan province, he has volunteered to teach English.

"I was fortunate to go there twice, and the energy and hope in the eyes of the students was incredible," he said.

Jaguar Land Rover's bond with students in the Yunnan school is so strong that some of their photos are on display at the company's office in Shanghai.

"Walking past photos of the Hope School students and their families every day continues to remind me what is important to us as a company and how we need to always support society as a whole," said Howard. "I will never sacrifice any budget or investment in corporate social responsibility activities here. CSR is always our top priority."