Is Jaguar’s radical new I-PACE benchmarking Tesla?

By Jim Prueter
MotorwayAmerica.com

(October 28, 2017) Most auto manufacturers are quite secretive when it comes to models they may or may not be introducing in the future. I can’t even begin to tell you how many times I’ve heard an executive from an auto manufacturer tell a room full of journalists that “we don’t talk about future products,” when asked about, well, future products.


But could Jaguar be taking a page out of Tesla’s playbook by not being secretive about its all-new all-electric I-PACE performance SUV? Jaguar proudly showed off its prototype as a concept vehicle at the Los Angeles Auto Show last November.

Jaguar also isn’t shy about its customer pre-order numbers, officially reporting 25,000 confirmed deposits against an anticipated supply of just 13,000 units.

Since that time the I-PACE has been seen all over the streets of London’s famous Olympic Park. Just last month, Jaguar became the first premium manufacturer to enter the FIA Formula E Championship — the world’s first battery electric vehicle race series — ahead of Mercedes-Benz, BMW and Porsche.


Like Tesla, Jaguar hasn’t been shy about hyping a vehicle it has yet bring to market. For a brand traditionally associated with composed, demure XJ sedans driven by proper, wealthy buyers, it’s actually shocking to me that the company beat the Audi e-Tron Quattro to market.

Yet with all the marketing efforts, the new I-PACE — whose production version is set to debut late this year, and be available for sale in 2018 — will account for less than two percent of Jaguar Land Rover’s annual sales, and likely will make less margin than other JLR products. This will be mostly due to high battery cost and the decision to outsource its production. We wouldn’t be surprised if the production version of the I-PACE will be revealed at the Los Angeles Auto Show this December.

In case you haven’t heard, JLR has been on an incredible winning streak ever since Ford sold it to Indian automaker Tata for the bargain price of around $2.3 billion back in 2008. Growth has been nothing short of phenomenal, with seven straight years of back-to-back sales increases. They hit a landmark of over 600,000 sales in 2016-2017. China has been especially important to JLR, where they recognized a 32 percent sales growth last year, with better days yet to come.

Further, unlike Tesla, the Jaguar Land Rover unit of Tata Motors has been consistently profitable. A rare success. Tata Group, overall, has been hurt by under performing divisions like Tata Steel, Tata Teleservices, Global Beverages and others. There’s also the sophisticated debt structure and holding company, and the recent and sensational boardroom coup at Tata Sons, ousting Cyrus Mistry who took over four years ago.

The interesting part of all this seems to be that JLR may be trying to mimic Tesla’s strategy. With just 22,000 vehicles sold in the second quarter of 2017 (compare that to Ford’s 1.7 million sales in the second quarter, and General Motors’ 2.3 million), Tesla is the most valuable American car company, worth over $53 billion today, about $3 billion more than GM.

Given this overall backdrop, the rumors about an IPO, with Tata spinning off JLR for some much-needed capital, don’t surprise me.

While the I-PACE isn’t a direct competitor to Tesla, Jaguar isn’t shy about touting range, zero to 60 times, charging rates, all similar to a Tesla. However the I-PACE is a smaller vehicle — presented as a crossover utility vehicle — with an estimated 220 miles of range, and will bring a halo effect to the brand.

Further, when considering that Tata is investing billions of dollars into a vehicle that will make up less than two percent of JLR’s annual sales, with profit margins most likely much less than JLR’s internal combustion engine products, mimicking the Tesla success with a strategically motivated, technically successful vehicle may be a wise strategy.


Vital Stats

• The I-PACE is the first-ever all electric vehicle from Jaguar
The production version will be revealed late 2017 and available in 2018

• 220 miles estimated via liquid-cooled 90kWh lithium-ion battery pack

• Combined output of 400hp and 516-lb-ft of instant torque

• Accelerates for 0-60mph in around four seconds.

• An SUV with a cab-forward design, a supercar silhouette, seating for five
The I-PACE will be built by contract manufacturer Magna Streyr in Graz, Austria