Jaguar-Land Rover starts building engines in India

- To build the Ingenium series of 2.0-litre engines to start with

- Might build larger 3.0-litre diesel engines as well

- Local production is expected to reduce import costs and duties

Tata Motors-owned Jaguar-Land Rover has begun expanding its India-footprint with the beginning of their engine-assembly line. To start with, the new 2.0-litre Ingenium series of four-cylinder turbocharged petrol and diesel engines will be built in India.

The 2.0-litre Ingenium mills power the entry-level and mid-level luxury cars from the JLR portfolio including the Jaguar XE and XF, the Land Rover Discovery Sport and the Range Rover Evoque. With increased localisation, the cost of importing assembled engines and the related import duties will be saved which should result in sizeable cost savings.

The competition in entry-level luxury car market is quite stiff given that Mercedes, BMW and Audi build almost the entire car in India. While Jaguar has always positioned itself at a premium, the lower input costs will allow the car maker to choose between going for a price offensive or a feature offensive. In either of these cases, the buyers will get a bigger bang for their bucks and this should result in higher volumes for the Indian subsidiary.

While we do not have any word on it yet, the larger 3.0-litre diesels, if built locally, will also help the Range Rovers and the Discovery become a little more affordable.