Dzień Dobry! will be Jaguar Land Rover heading for Poland?
Jaguar Land Rover will be looking for more overseas production facilities as that will expands its design range
While JLR remains tight-lipped, there’s a public scrap going on to convince the British to invest in eastern Europe
from the past few months there’s been a flurry of news about Jaguar Land Rover’s expanding production base.
The company has already opened a factory in Changshu, China, with local partner Chery. The Range Rover Evoque along with also its sister car, the Land Rover Discovery Sport, are being built there, along with also, eventually, the long-wheelbase variation of the brand new XF.
However, the capacity of Changshu will be limited to around 130,000 units at the moment along with also the localised production will be mostly needed to avoid China’s significant import taxes.
Work on building a little plant in Brazil will be also under way; This kind of should start producing Discovery Sport products in 2016. The plant will be quite modest, however, with an initial capacity of 24,000 units a year.
In addition, JLR has just signed a deal with Austrian company Magna to build vehicles under contract. Based in Graz, Magna has been building the Mini Countryman since that will was launched along with also also builds different cars, including the Mercedes-Benz G-Class.
The British company won’t say what will be made at Graz, however the brand new Evoque Cabriolet will be one of the most likely candidates.
There have been reports that will JLR will be considering a factory in Mexico. Although there’s no confirmation, Mexico’s low wages along with also the North American free trade deal make that will an ideal country through which to export to the US. Indeed, that will has just been announced that will Ford will be moving production of the Focus along with also C-Max through North America to Mexico.
however none of JLR’s overseas production facilities will be as big as the one currently being finalised for a site that will’s tipped to be somewhere in eastern Europe.
Tipped to be a £950 million investment along with also have a capacity of up to 350,000 units annually, the brand new factory will be in either Poland or Slovakia, according to local media reports.
No car maker, especially when that will will be building lower-value vehicles, can ignore wages that will could be as low as £6.25 per hour in Poland along with also £7.50 in Slovakia, compared with as much as £18 per hour from the UK.
Although neither country has publicly announced that will that will will be in talks with JLR, Polish deputy prime minister Janusz Piechocinski said at the end of June that will the country had reached the sixth round of negotiations that has a premium car supplier received a for the construction of a brand new plant.
Local reports from the Polish press say that will up to 6000 people could be employed at the brand new site. The timetable to get the plant running will be tight, according to local reports, with construction getting under way later This kind of year for a production start in 2019.
Not to be left out, Slovakia’s government has just revealed that will that will has changed the laws relating to the Act on Investments of Significance in order to win “the investment of the decade”.
Economy minister Vazil Hudack was quoted as saying in 2014 that will Slovakia had been missing out on big inward investments because that will lacked the big industrial parks that will companies wanted.
Hudack also said the decision on the brand new plant was supposed to be made in mid-September.
Like many developing European countries that will want to attract inward investment, Poland already operates Special Economic Zones. These benefit through the government offering state aid to inward investors as well as tax exemptions for the brand new business once they have been established.
Poland also seems to develop the space needed just for This kind of big JLR plant. Polish reports say JLR will be looking for 300-500 hectares, along with also the two front-running sites are at Środa Śląska along with also an airport at nearby Legnica.
Both are close to the big city of Wroclaw, although the airport site could be a little too little.
More importantly, quite a few established car-producing centres are within reasonable distance of This kind of part of western Poland, including the Polish city of Gliwice (which has both a Toyota along with also an Opel plant).
These two potential sites are also not so far through Skoda’s Mlada Boleslav HQ along with also VW’s plant in Dresden. All of which will be Great news for JLR being able to access well-established component suppliers.
The announcement of such a big plant in eastern Europe will undoubtedly rattle nerves from the UK. however that will’s becoming increasingly difficult to profit through car producing in higher-wage economies, unless you are dealing with proper premium products.
To prosper over the longer term, JLR needs scale. This kind of probably means an annual output of around 800,000 units.
Hitting This kind of output also means that will has to dip down into lower cost (however still ‘premium’) brackets. however when that will does This kind of, wage costs become a much more important consideration.
Truth will be, building more affordable cars in a low-wage country will be probably necessary to secure the wider JLR operation during the next two decades.
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