Jaguar Land Rover To Initiate Vehicle Production At Tamil Nadu Facility By 2026

Updated: Friday, June 27, 2025, 10:16 [IST]

Jaguar Land Rover, the British luxury car marque owned by Tata Motors, is set to start vehicle production at its parent's new facility in Tamil Nadu by early 2026 claims a new report. This move will involve assembling completely knocked down (CKD) units at the Panapakkam plant, which is expected to receive over ₹9,000 crore in investment from Tata Motors.

The construction of this plant began in September 2024 and aims to produce both Tata Motors and JLR vehicles. The facility will have an annual production capacity exceeding 250,000 vehicles. PB Balaji, Tata Motors' group chief financial officer, mentioned that CKD operations currently based in Pune might gradually shift to the Tamil Nadu site.

Local Assembly and Market Expansion

JLR initially started assembling CKD units of its Land Rover Freelander 2 model in India at the Pune plant in May 2011. In 2024, local assembly of Range Rover and Range Rover Sport models commenced there as part of efforts to expand market presence and reduce prices. Import tariffs on completely built units are around 110%, while CKD units face a reduced tariff rate of 16.5%.

In the last financial year, JLR achieved its highest retail sales figures in India since being acquired by Tata Motors for $2.8 billion in 2008. Sales surged by 40%, reaching 6,183 cars, with a remarkable 110% growth recorded during the January-March quarter alone, totalling 1,793 car sales.

Challenges and Strategic Adjustments

Despite these achievements, JLR faces challenges globally. On June 16th, JLR announced a reduction in its earnings before interest and tax margin guidance for FY26 to between 5-7%, down from the previously stated 10%. This adjustment is due to US tariffs and a slowdown in the Chinese market.

The company's profit after tax also decreased by 30% in FY25 to £1.8 billion from £2.6 billion in FY24. However, India's luxury car market continues to grow with premium vehicle demand driving sales to an all-time high of 51,000 units in FY25.

Future Plans and Market Position

JLR's best-selling models in India include Defender, Range Rover, and Range Rover Sport. Although Defender models are not yet produced locally, Richard Molyneux, JLR's chief financial officer, confirmed plans are underway for local assembly during an earnings call on May 13th.

The local assembly has led to price reductions of up to ₹44 lakh for some models last year. This strategy helped JLR surpass Audi India to secure the third position among luxury car manufacturers. The UK-based company contributes significantly to Tata Motors' revenue and profits—71% and 79%, respectively. This strategic expansion into India's growing luxury car market aligns with JLR's efforts to strengthen its presence amid global challenges while capitalising on local demand for premium vehicles.