Jaguar's I-Pace challenge: Turn buzz into sales

FARO, Portugal — About two dozen reporters this month drove all-wheel-drive Jaguar I-Pace crossovers across a stream nearly 45 cm (18 inches) deep here, then up a steep, dusty mountain road, then around a Formula One racetrack, deep into triple-digit speeds — all without burning a drop of fuel.

Two days of driving the battery-electric I-Pace some across southern Portugal convinced the nitpicky scribes that the I-Pace can more than compete with Tesla and electric vehicles coming soon from Audi and Porsche.

Its 90 kWh Lithium-ion battery delivers a 480 km (nearly 300 mile) range based on European WLTP cycle. The 394 silent hp and 696 Newton meters  (512 pound-feet) of torque help to provide acceleration of 0 to 100 kph (60 mph) in 4.8 seconds. The I-Pace performs more like a sports car than a five-passenger midsize luxury crossver.

The looks are striking, it has a long list of standard luxury and safety features. Available to order now, prices start at 63,495 pounds in Jaguar's UK home market and $70,495 in the U.S., including shipping — at least $10,205 below the least expensive Tesla Model X, the only other electric crossover available.

Combine all that with a wide dealer network — which Tesla does not have — and the I-Pace looks like a hit for Jaguar.

Except that it may not be.

Despite a showroom of fresh vehicles, Jaguar has faltered this year mostly because of the industry shift away from cars. But the 2-year-old F-Pace, Jag's first crossover, also has lost steam. And a fuel-system problem stunted the launch of the compact E-Pace crossover this year. So, if one thing is clear, it's that the I-Pace, good as it is, is no slam dunk.

Marketing conundrum

Jaguar Land Rover's toughest task — even more difficult than designing, engineering, testing and then getting the I-Pace to dealers ahead of the competition — will be marketing the vehicle.

"Jaguar knows how to design a stunning crossover," says AutoPacific analyst Dave Sullivan, citing the success of the F-Pace, the fastest-selling vehicle in Jaguar's history. But "going all electric has unique challenges for a company where the brand has not had to launch an EV before."

Says Sullivan: "Jaguar was at the bottom of J.D. Power's [2018 Initial Quality Study], and this is going to be their first EV. Jaguar doesn't have the same leeway with customers that Tesla has. Tesla customers might look the other way or chalk it up to Tesla being Tesla when it comes to quality problems, but Jaguar customers expect more from an established brand."

No matter how positive the test-drive reviews, JLR officials believe, they can't duplicate the media fascination and consumer passion for Tesla and its products, and they don't plan to try. There won't be comparisons to the Model X in I-Pace ads or dealer communications.

"The EV market is in its infancy," says Stuart Schorr, JLR's U.S. vice president of communications. Schorr also manages JLR's U.S. advertising and retail and digital marketing communications.

There is no template — yet — for marketing mass-produced EVs. Tesla, which sells directly to consumers, doesn't play by the same rules as other automakers. And General Motors has expended very little effort marketing the Chevrolet Bolt nationally. What few Bolt ads have appeared generally have been market-specific.

JLR's strategy for selling the I-Pace is more akin to hand-to-hand combat than to saturation bombing. There will be no big, sustained national advertising blitz.

"Jaguar is still a small brand in comparison to Mercedes and BMW," says Schorr. "So, we are taking a smart approach to the market. It's a premium vehicle in a developing marketplace."

The battle to gain the attention of potential EV customers started with the media. The concept version of the I-Pace made its global debut in California, the world's largest EV market, in late 2016 at the Los Angeles Auto Show. Since then, the I-Pace has been on the global auto show circuit nonstop.

From March to mid-June this year, JLR spent millions of British pounds flying reporters from all over the world to Portugal to drive the I-Pace on the punishing course over twisty mountain roads. It was a huge operation for a company the size of JLR, involving nearly 700 reporters in 25 waves, at least 100 I-Paces and several hotels. A rotating phalanx of the company's top executives and dozens of staff shuttled in and out of Portugal for more than three months. The reviews started landing around this month.

Now come the dealers. This week in San Diego, JLR begins one of the biggest dealer sales training programs in the company's history. By the end of July, about 1,800 sales personnel will have learned how to communicate to customers on topics many have never addressed, including charging times and locations, local tax incentives, high-occupancy vehicle lane use and other unique aspects of EVs.

Stephanie Brinley, a principal automotive analyst at IHS Markit, says the I-Pace is arriving as interest in EVs is rising. She sees marketing challenges for Jaguar but also says it has advantages over Tesla. The I-Pace being a utility vehicle is critically important, says Brinley.

"People have not traditionally gone to Jaguar for an SUV, much less for a performance SUV with an electric propulsion system," Brinley says. "But in today's market, people are going to nearly any brand showrooms, often for SUVs. The I-Pace comes along with a known brand and terrific styling. It seems to have delivered largely on the 'and' proposition better than Tesla or EVs before it — it's an EV 'and' so much more. It is attractive for its own sake, regardless of propulsion system."

Early interest

Schorr won't say how many I-Paces JLR expects to sell in the U.S. Company officials don't think it will topple the F-Pace, Jaguar's volume leader, with about 1,200 sales per month. But some early breadcrumbs on the marketing trail show that the I-Pace at least has the potential to restore the roar in the car-heavy Jaguar brand, which is off 30 percent in sales in 2018 in the U.S., despite the fresh lineup.

More than 25,000 potential customers have asked Jaguar to send them regular updates and news on the I-Pace. There are preorders, Schorr says, but he won't say how many. Indeed, it's probably wise to avoid comparisons to Tesla's Model 3 introduction, where 325,000 people placed an order and a deposit in the first week.

"Jaguar is not the first brand people will think of when they think of an electric vehicle," says AutoPacific's Sullivan. But he, too, sees a few advantages it has over Tesla. "The I-Pace at least has the interior materials and design that looks like a luxury car. The same can't really be said about a Model X. The luxury brands are about to drop quite a few new vehicles into this space in the next 18 months. The one right thing that JLR did was pick a body style that consumers want."

Another positive sign is that two companies, Waymo and WeKnowGroup, have chosen the I-Pace for duties that will expose thousands of people to the vehicle. Waymo has committed to buying as many as 20,000 I-Paces for its fleet of self-driving cars. WeKnowGroup, a British transportation company, will buy 200 I-Paces and use them to ferry travelers to and from London's Heathrow Airport.

Schorr says JLR believes the I-Pace will help change lingering perceptions of Jaguar's old-world wood and leather interior past.

"What we've been doing the last five years is modernizing the Jaguar brand and introducing it to new customers," he says. "Now it's a brand that includes performance SUVs. We want to put this car in the context of the modern Jaguar brand, led by the F-Type as the sort of heart and soul. We think that I-Pace gives a bit of a shine on the overall Jaguar brand."

As for I-Pace marketing, Schorr says: "For EV enthusiasts who are well-read, I have no doubt they are aware of the vehicle."