COVENTRY, England - Jaguar is looking to Volvo dealers to take on the Jaguar franchise in continental Europe.
Jaguar is basing its aggressive growth strategy on increasing sales in Europe. Volvo dealers could play a part in that growth.
Currently, Jaguar has 250 dealers on the European continent. That number will grow to 350 over the next two years, according to Stephen Perrin, Jaguar's director of European operations.
'We're looking to Europe to spearhead the growth of Jaguar,' Perrin said in an interview here.
Jaguar's top priority is Germany, home to luxury archrivals BMW and Mercedes-Benz. Jaguar must convince BMW and Mercedes-Benz owners to switch brands if it is to hit its target of climbing from a record 50,220 global sales in 1998 to about 200,000 per year by the middle of the next decade.
Jaguar has 85 dealers in Germany. Within two years, Perrin wants that to increase to between 115-120.
That's where Volvo comes in. More than 40 percent of Jaguar's dealers in Germany have Ford franchises. Now that Volvo has joined Jaguar in the Ford family, Jaguar hopes Volvo dealers will be interested in taking on Jaguar franchises in Germany and elsewhere.
'Dualing with Volvo will give our dealers a good opportunity to save costs,' Perrin said.
Perrin stressed that Jaguars and Volvos will never be sold from the same showrooms. But he said dealers could save money by combining back-office costs.
So far, Jaguar's aggressive growth strategy appears to be succeeding. At the end of October, worldwide sales had already exceeded 1998's total.
This success was fueled by the new S-type, introduced earlier this year. The S-type has been a huge success in Europe, particularly in Italy. S-types are sold out in Italy until next summer, Perrin said. Italians like its sleek styling, he added.
'A lot of people new to the (medium luxury) segment are going straight to S-type,' Perrin said.
Jaguar is already starting to conquer owners of other brands. A high number of S-type buyers are coming out of Mercedes-Benz, followed by BMW and Audi, Perrin said.
Jaguar needs such conquests if its growth ambitions are to succeed.
'Very few (S-type buyers) are coming out of Jaguars,' Perrin said. However, Jaguar officials do admit production of XJ sedans at its Browns Lane plant here has fallen a little, and some of those sales have been lost to S-type. The S-type is built at Jaguar's other English plant in Castle Bromwich, Birmingham.
Jaguar's European growth strategy will help reduce Jaguar's traditional dependence on North America. The US market currently accounts for about 50 percent of its global sales. Company officials would like to see that percentage fall. In the 10 months to end-October, Jaguar sold 26,490 cars in the USA, breaking the long-standing record of 24,464 vehicles sold over 12 months in 1986.