Land Rover stung by success

Nick Gibbs is UK correspondent at Automotive News Europe.Nick Gibbs is UK correspondent at Automotive News Europe.
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Demand for the Range Rover and Range Rover Sport is so strong that Land Rover is struggling to fill orders.

The waiting time for the recently launched Range Rover Sport is nine months while buyers of the larger Range Rover, on sale since the start of this year, must wait six months, a spokesman told me.

The demand is particularly strong in China, despite list prices as high as 2.8 million yuan (338,000 euros) for the Range Rover.

The Chinese aren't patient – anecdotal evidence cited in a recent report on Jaguar Land Rover by Bernstein Research said buyers there are prepared to pay premiums equivalent to 60,000 euros to move to the top of the waiting list.

The impressive margins made on the Range Rover and Range Rover Sport are almost single-handedly funding the company's future growth plan, according to the report.

There's nothing Jaguar Land Rover can do to ease supply because its factory in Solihull, central England, is running 24 hours a day, seven days a week.

According to the Bernstein report, JLR vastly underestimated demand for the two SUVs. "Order intake globally is almost 40 percent above JLR's original planning base case," report author Max Warburton wrote.

Making the issue worse is that JLR can't get enough engines from supplier Ford Motor Co, Wolfgang Epple, director of research and technology, says. The company's former owner still builds the majority of engines for Jaguar and Land Rover.

JLR will make its own range of four-cylinder engines starting in 2015. The modular powerplant could be doubled in size to eight cylinders, but the business case to build a V-8 in-house hasn't been made yet.

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