Jaguar Land Rover is to expand into Saudi Arabia by using an aluminium pressing plant and, eventually, a production line to make an all-new Land Rover model there.
The British car maker has signed a letter of intent with the National Industrial Clusters Development Program in Saudi Arabia to buy aluminium from what is being described as one of the world’s largest aluminium smelters.
It is then expected to produce body panels for future models, and other components, at an all-new, state-of-the-art pressing plant that is being built in the kingdom.
Ralf Speth, CEO of Jaguar Land Rover, says now that the company is on a “solid footing”, it has to expand globally. He says he is confident that this move is the right one for the firm, allowing it to secure the “cheapest aluminium in the world”.
A memorandum of understanding is expected to be signed in the middle of 2013, before the production begins in early 2015.
There’s no news on which new model will be built in Saudi, but JLR sources have hinted that it could be based on the new Range Rover platform.
The new model (which sources insist was never intended to be made in the UK) will initially be sent to the Saudi line as a ‘knocked down’ kit to allow the operation to gain experience, before full production switches to the country.
The main driver behind this radical move, says Speth, is to secure a steady, cost-effective supply of aluminium as global demand for the material starts to rise. Global fuel economy regulations are expected to make the use of lightweight materials increasingly important for the car industry.
Saudi Arabia is well positioned for this project because it has both vast bauxite deposits — the rock that is the main source of aluminium — and the cheap power ideal for the energy-intensive process that’s needed to create aluminium.
Speth says JLR is committed to a “lightweight future” and its demand for aluminium will rise considerably, with at least four Land Rover company models made from the materials. Most future Jaguars are also expected to be made of aluminium.