Jaguar Land Rover Isn't Changing Its Plans Because of Brexit; Analyst Says Pain Lies Ahead

Jaguar Land Rover’s brands are as British as crumpets and the Union Jack (ignore the fact that it’s owned by India’s Tata Motors), so concerns over Britain’s vote to leave the European Union should fall squarely on its tweed-covered shoulders.

The automaker is keeping a stiff upper lip, at least in public, with a spokesperson saying the company doesn’t plan to make changes to its strategy, Reuters reports.

A $1.34 billion assembly plant in Slovakia is going ahead as planned, said Jaguar Land Rover strategy director Adrian Hallmark, who called the Brexit a “short-term issue” during a news conference.

“Our commitment is to our existing operations in the UK, future operations in Europe of which we have already announced the Slovakia plant which will be coming on stream in just a few years,” Hallmark said.

The Slovakia plant’s location was picked from a diverse list of potential sites that included the U.S. and UK. Production could reach up to 150,000 vehicles per year after it opens in 2018.

One industry analyst, speaking with Bloomberg, said the short-term pain for the UK and EU will be severe. Ian Fletcher, analyst for IHS Automotive, told the publication that the Brexit vote could erase the sales of 2.8 million vehicles between now and 2018.

“The U.K. is, unsurprisingly, anticipated to bear the brunt of the impact,” Fletcher said. He predicts that the UK vehicle market will shrink from a previously estimated 3.2 million vehicles to just one million, according to IHS calculations. Expect declines for two years after that, Fletcher added.

According to the Society of Manufacturers and Traders, at last count, the $20 billion-plus British auto industry ships 80 percent of its vehicles overseas, with 60 percent of that total bound for countries in the EU.

[Image: Jaguar Land Rover]