Under the Microscope: We talk to Jaguar Land Rover UK managing director, Jeremy Hicks
21 July 2017
Author: Debbie Wood
Jaguar Land Rover is very much the new kids on the block in the premium fleet car sector, and the success the firm has enjoyed over the past three years is clear to see, with UK sales up 16% for the last full financial year.
Offering an alternative to the familiar German brands, growth for Jaguar in fleet has been significant and the UK is proving to be an important market for the firm, representing over 20% of global volume sales.
"There's a number of brands that have operated in the fleet market for a number of years now at the premium end of the market and drivers have had many years of rotating between them," Jeremy Hicks, Jaguar Land Rover UK MD tells BusinessCar. "Now we've come in and we're a very attractive alternative.
"We play very heavily on the fact that we are British too - even though we're a young business we have a great heritage already and it means a lot."
Hicks is the first to admit that Jaguar Land Rover perhaps didn't focus on the fleet industry as much as it needed to five years ago, an approach that has radically changed over the past few years. Growing the fleet team was essential, enabling more customer managers to be out talking to customers, while improving the relationships with contract hire and leasing companies and supporting the dealer network to grow small business sales have also been important initiatives.
"To be successful in fleet you've got to work well with the contract hire and leasing companies and you've got to have a very tight seamless relationship where you're focussing on all of the key areas that they require and using them to help shape and drive strategy," Hicks explains. "We now have all the processes in place - it's the products' turn to do the work."
Jaguar's success story in fleet really started with the XE, which was launched three years ago. It's quickly become a core fleet model with over 60% of sales going to corporate users.
For Land Rover the launch of the new Discovery has also been key, which made a distinct move towards a more premium and upmarket look and feel. For Hicks the key thing here was to communicate that although the design had changed, the new car is just as capable off-road as the old model.
"People talk about having a Land Rover like having a Hoover instead of a vacuum cleaner and keeping that ideal is no doubt a challenge for us, but it's a good challenge because what we're finding is the new Discovery is bringing more people into the brand than before," Hicks says. "What we had to do was demonstrate that the fundamental underpinnings of the car are as good as ever - it can go through rivers and climb mountains and it can do it just as well as the car it replaced, so none of the capability has been lost but design had to move on".
Data suggests that by 2030 around 30% of the market will be battery electric, but Hicks believes the more interesting stat to highlight here is that 70% of the market will still be powered by a combustion engine, whether that's petrol or diesel or plug-in and conventional hybrids.
Although the carmaker plans to have 50% of its range electric or hybrid by 2020, Hicks believes diesel still has a very important role to play moving forwards and it's vital that the advancements and improvements to diesel technology over recent years do not go unrecognised.
"As an industry we've got a lot of work to do to get the message out that clean diesel is just that," Hicks explains. "Let's recognise the improvements we've made to our emissions and capabilities of the internal combustion engine over the past 10 years and I believe it will continue to play an important role."
Jaguar Land Rover recently did its own research where the firm spoke to 1,000 of its customers and one of the key aspects that came out of the findings was that customers are unsure about diesel, especially smaller businesses, with some not knowing the key differences between NOx and CO2.
The research also showed that more than half of drivers didn't know what Euro6 standards meant, while 50% thought that road transport is the biggest contributor to urban pollution, which is not true as commercial and household properties alone produce more than half of the particulates polluting our cities.
So much improvement has been made to reduce CO2 emissions over the past 15 years, with 25% reduced in the last five years alone. What the industry doesn't want is everyone now moving into petrol cars because they view diesel as bad. Hicks is keen to point out that it's not about pointing fingers either, but recognising that the only route through this is by collaboration.
"If all our sales switch to petrol then we've not got a problem. We have a new facility in Wolverhampton building engines and we have no issues with switching, but I want to make sure people are buying the right cars and that our overall impact is one that is positive.
"The truth is that petrol isn't always the answer. Petrol has a worse CO2 performance and NOx is about air quality and actually you've got to weigh up the two.
Vehicles in London are one of the lowest contributors to NOx. Actually, one of the worst offenders is wood-burning stoves, which contributed to 17% of all particulate emissions in 2013, only marginally less than the 18% from all road transport."
Hicks believes that the impression is being given that the way to improve air quality in our cities is to simply ban diesel cars from entering them. But it's not that simple and false impressions cause confusion with the people car manufacturers are trying to educate.
As well as driving improvements in diesel technology, Jaguar Land Rover is currently investing £4bn a year in new technologies to help keep pace with this ever-evolving industry.
"We are about to see a change in the market like we have not witnessed for many, many years. The landscape is going to change and it is going to change very quickly," Hicks says. "What we have to recognise is that we're not making cars, we're creating experiences for people and that's what it's all about and that's why technology will continue to play such an important role in the experiences we bring our customers and that's why we're investing so much."
Like many companies, Jaguar Land Rover wants to grow. However, Hicks is quick to highlight the importance of not doing business at any cost and the ideal is to have more of a demand-pull than a supply-push. Hicks doesn't see being the market leader as a goal for the firm in fleet either; instead, the focus is to have a very strong client base and customers that will come and enjoy the experience and want to stay.
"Our strategy isn't about volume at any cost, we've got to grow organically globally across all emerging markets," Hicks explains. "Yes, of course we want to sell but we also want to be trusted advisors that help fleet managers make the right choices and that's what we have to do and that's what we're training our fleet team to be, the fact-holders."