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European automakers gear up for Brazilian production

Brazil is the place to be, apparently. Toyota has been investing in the South American country, as has BMW, which announced a $261 million investment in October 2012, on the heels of an Audi factory announcement in San José Chiapa. The high-end immigration is only set to continue, as Mercedes-Benz and Jaguar-Land Rover have both announced plans to set up manufacturing operations there.
Mercedes is the big news here, as its new facility will see the German manufacturer invest 170-million euros for production of its next-generation C-Class and upcoming GLA-Class. "Brazil is an important future market. With our local production we accept the challenge and take on the competition," noted Andreas Renschler, Management Board member for Production and Procurement at Mercedes-Benz Cars and Mercedes-Benz Vans. Production is expected to begin by 2016.
Jaguar-Land Rover, meanwhile, isn't so concrete in its plans. The news of its investment in South America comes from a job posting for a plant quality manager in Brazil that was picked up by the UK's AutoCar. "Portuguese language skills will be definite advantage" for interested candidates, according to the job listing. The want ad follows on the heels of remarks by Jaguar Land Rover's Dr. Ralph Speth, who said there are "very intensive discussions" with Brazil's government. Unlike Mercedes, there's no mention of which vehicles will be produced in South America, although AutoCar thinks the Freelander, sold in the US as the LR2, is a leading contender.

Jaguar Land Rover remains bullish on diesels

Despite Volkswagen's recent diesel scandal, Jaguar Land Rover is pushing ahead with ambitious plans to roll out the technology across most of its lineup in the coming years. Jaguar and Land Rover will add diesel engine variants to every model in their lineups, except for the Jaguar F-Type sports car. Land Rover launched the Range Rover and Range Rover Sport with available 3.0-liter turbocharged V6 diesels, and together they have sold more than 330 units so far in September, their first month on sale in the United States. JLA officials say they've seen no fallout from VW's emissions problem and are adamant their diesels meet EPA standards. "That has been our strategy, and it is not changing," Joe Eberhardt, Jaguar Land Rover North America CEO, told the Automotive Press Association on Wednesday in Detroit. "You have to deal with the situations as they arrive. We are confident of diesel." Jaguar will get another diesel next year from its Ingenium engine family, which will initially be sold in the XE sedan and the F-Pace crossover. It's a turbo 2.0-liter four-cylinder unit and makes 180 horsepower and 317 pound-feet of torque. A JLR spokesman said the Ingenium has not yet gone through the EPA certification process, and the diesel-powered models will arrive in the fall. Jaguar also plans to add diesel engines to the flagship XJ and XF sedans. Land Rovers, including the Discovery and Evoque, will also get diesel options, and the company estimates the technology will offer 20- to 30-percent improvements in fuel economy, depending on the vehicle. Eberhardt said it is "too soon to tell" if the diesel market will be weighed down by Volkswagen's situation. The German automaker admitted to cheating on emissions tests to make its diesel-powered cars appear to run cleaner than they actually do in real-world situations. The ensuing outrage forced longtime VW chief executive Martin Winterkorn to step down and prompted a reorganization of the company, which faces legal and regulatory action around the world. Still, Eberhardt maintains JLR is "very confident" in its diesels, which are part of its strategy to grow sales around the world. Land Rover has experienced rapid growth under the ownership of Indian conglomerate, Tata Motors, while Jaguar is set to revitalize its lineup with new entries like the XE and F-Pace to reach a broader market segment.

Jaguar may join the FWD, small-car parade

Was it right for Chevrolet to detune the 1975 Corvette's base engine to 165 horsepower? Was Aston Martin wrong to make the Toyota iQ-based Cygnet? Is BMW crazy to be testing the new 1 Series with three-cylinder engines and front-wheel drive? It seems now, just as in the 1970s and 1980s, that emissions regulations and social considerations are driving some automakers to adopt unbefitting practices to maintain acceptance in the eyes of governments and consumers. Jaguar has jumped on the bandwagon, and is considering development of small, frugal, front-wheel-drive cars to help lower Jaguar Land Rover's average vehicle CO2 levels in light of tightening European emissions regulations, Autocar reports.
By 2020, the European Union expects the model range of every manufacturer to average 95 grams per kilometer, which is a new law passed by the European Parliament in April. Manufacturers who make more than 300,000 vehicles per year must meet these targets, and JLR is expected to be producing up to 700,000 vehicles per year by then. CO2 regulations after 2020 will only get stricter, as EU politicians already are talking about lowering CO2 levels to between 68 g/km and 78 g/km. (To put that in perspective, Autocar posits that driving a fully charged electric vehicle in Europe produces about 75 g/km when factoring in the power-generation infrastructure.)
Jaguar has some choices here, but so far they all have drawbacks. It could develop a new, compact chassis architecture for a line of compact vehicles, but the investment required for such a project could be prohibitively expensive. Jaguar has been looking into using the Land Rover Evoque platform for a small SUV, Autocar reports, but Land Rover brand manager John Edwards raises issue with such a plan, saying it may not be financially feasible.