Whether you're bullish or bearish on Tesla Motors (NASDAQ:TSLA), it's increasingly obvious that the Silicon Valley start-up has made a big impression on the established automakers, particularly in the luxury segments.
Tesla has shown the world that electric cars can be luxurious, desirable, and cool. In the process, it has generated big demand -- and taken some big bites out of the the sales of more established luxury-car brands.
Slowly, the luxury-car incumbents are gearing up to fight back. Here's how Jaguar Land Rover, now owned by India's Tata Motors (NYSE:TTM), is planning to enter the new and promising market for "premium electric vehicles."
In development: 2 new battery-electric Jaguars
Jaguar Land Rover (JLR) has shown off a number of battery-electric and plug-in hybrid concepts in recent years. But the latest reports suggest that its plans have firmed up: According to Automobile Magazine, JLR is currently gearing up to produce two new battery-electric vehicles: a premium SUV and a big, opulent sedan. Both will be sold under the Jaguar brand, according to the report.
It's a serious effort. The sedan is said to be the successor to Jaguar's current top-of-the-line (gasoline-powered) XJ sedan, though the two may be sold side by side until JLR is certain that the market will accept its electric sedan. It'll have all-wheel-drive, an exterior design that is said to be "breathtaking," and will be able to incorporate advanced self-driving capabilities as that technology is perfected.
British magazine Autocar reported last month that the electric Jaguar SUV, currently in testing, has four electric motors, one for each wheel. It's expected to be smaller than Jaguar's electric sedan, possibly sharing architecture with Jaguar's compact F-Pace crossover SUV.
The electric Jaguars may be built by Austrian contract manufacturer Magna Steyr, a unit of the giant auto-industry supplier Magna International (NYSE:MGA). JLR announced a "manufacturing partnership" around unspecified future products with Magna Steyr last year, and it probably doesn't have the facilities to set up a new dedicated assembly line for the electrics on its own.
JLR expects the electric Jags to sell like Teslas
Jaguar expects the sedan to sell between 20,000 and 30,000 units per year, according to Automobile's report, while the SUV is expected to sell between 30,000 and 50,000 per year. At the lower end, that's comparable to the 50,557 cars sold by Tesla last year. At the upper end, it's not far short of the total Tesla expects to sell this year, now that the Model X SUV is in full production.
At those volumes, the two would represent a significant chunk of JLR's global sales: It sold just over 487,000 vehicles last year.
When will they arrive?
When will they arrive at dealers? It's not clear. There are signs that the sedan is on the fast track, but given the strong global demand for crossover SUVs, it seems more likely that the SUV would come first. Either way, the first is likely in 2018, with the second to follow a year or so later. I expect we'll hear much more about JLR's electric-car plans over the next few months.