Jaguar Cars Limited, the wholly owned subsidiary of Tata Motors, is expected to start the production of its executive car XF to Indian shores soon. Currently, the XF sedan is marketed in the country as a Completely Built Unit (CBU) and hence comes at an exorbitant price tag.
Jaguar pitched its XF sedan against the likes of Audi A6, Mercedes-Benz E-Class and BMW 5 series but failed to match the price constraints of its counterparts due to their local production in the country. XF sedan has been available in the Indian car market via CBU route, which is the prime reason for its steep pricing due the heavy import duty levied by the government. Among the luxury auto brands operating in the country, the import duty struck the Jaguar company hardest, largely due to the absence of its own manufacturing facility in the country.
According to the 2012 Budget by the government, all vehicles arriving in the country via CBU route are to be charged an import duty of 75 per cent as against last year's 60 per cent, which has increased the prices of imported cars by a great fraction. However, there has been no hike in the import duties of products arriving as Completely Knocked Down (CKD) kits, which may be the reason for the Jaguar's decision to bring the production of XF sedan to Indian turf. The cars assembled from CKD kits are entitled to much lower excise duty at 30 per cent, if it features a pre-assembled engine and transmission system. Reportedly, if the components are further knocked down into individual parts, the import duty is levied at 10 per cent.
Tata owned Jaguar has revealed intentions to establish a new assembling operation for the XF premium sedan at the same plant where Land Rover Freelander 2 is currently assembled. According to Autocar India, Ratan Tata, Chairman, Tata Motors said, “We will look at assembling the XF in India if there is a business case for it.”
Reportedly, if Jaguar establishes its assembly operations in India, it might also introduce the lower variants of XF sedan in the Indian premium car market as well. The launch of trimmed down variants of XF sedan will put the car in a direct face off against the likes of Mercedes-Benz E220 CDi, Audi A6 2.0 Tdi and BMW 520d, which will put the Jaguar in a comfortable position against its rivals in the premium luxury car segment.
The gross sales of Jaguar and Land Rover vehicles stood at 2,300 cars last year and the Tata owned subsidiary is aiming to record sales of 2,500 vehicles in 2012.
