by Production in the US: why it makes sense
Jaguar Land Rover plans to set up vehicle production in America. The company fully understands that local production will allow it to save significant money on customs duties. However, it will not act alone, but together with Stellantis — and the result promises to be unusual. The partners are preparing to produce Defender models aimed specifically at the US market.
JLR CFO Richard Molyneux confirmed the overall plan during an August conference call with investors. Back in May, the automakers signed a preliminary agreement, and a memorandum of understanding is expected by the end of the year. This will pave the way for production to start at Stellantis’ US plants. However, the current lineup is unlikely to remain as it is now.
Molyneux stressed that JLR does not sell enough vehicles to justify localizing existing models. Automotive News quotes him:
“At our scale, there is no point in localizing production of existing models in North America. We sell about 30,000 Defenders in the US each year. We could never efficiently localize production at 30,000 or even 50,000 units.”
What new models could appear
According to Molyneux, the brand will launch new models in segments it currently does not occupy, developed under the Defender name in partnership with Stellantis. JLR does not say exactly which segments are involved, but the most obvious candidate is a traditional body-on-frame SUV created with Stellantis’ support.
A new Defender sharing its platform with the Jeep Wrangler would give the brand an affordable alternative below the current Defender, which will remain on sale. It would also become a real competitor to the Wrangler, Ford Bronco, and even the electric trucks and SUVs that Scout plans to produce. In addition, it would solve a very expensive problem: every JLR vehicle in the US arrives from abroad, including the Slovak-built Defender.
Tariffs and currency risks
The company currently pays 10 percent duty on cars assembled in the UK and 15 percent on vehicles from the European Union. Local production would avoid this financial burden and reduce sensitivity to exchange-rate fluctuations between the US dollar and the British pound. This is critical because North America is already JLR’s largest market. In the fiscal year that ended March 31, nearly 100,000 vehicles were sold there — 28 percent of the company’s global sales volume.
In the quarter that ended June 30, North America’s share rose to 34 percent, while China’s figures continued to decline. JLR has ambitious plans for the US, because that is where its vehicles generate the highest profits. The company wants its American business to grow to the scale of JLR’s entire current global operation, and a locally built Defender could be one of the most direct steps in that direction.
What’s next?
This initiative also makes sense because Stellantis has idle production capacity at its US plants. At the same time, such cooperation may raise questions among brand enthusiasts: how much of a true Land Rover will a Defender — historically a symbol of British engineering — remain if it is built on a platform close to Jeep’s? The very fact of the negotiations shows how seriously JLR takes the US market and how quickly global production chains are changing. If the project is successfully implemented, it could mark the beginning of a new era for the Defender — no longer just an icon, but a product adapted to a specific market, preserving its heritage while gaining more modern production logistics.
