Indian automaker Tata is set to double its investment in its Jaguar-Land Rover division to $2.4 billion per year, reports Reuters. Tata is justifying the investment due to strong demand for the 2012 Land Rover Range Rover Evoque, and growing demand in emerging markets.
Reuters reports that since purchasing the storied British brands, Tata has used Jaguar and Land Rover to offset its sagging demand in its home market. Jaguar-Land Rover has reportedly been responsible for 95 percent of Tata's profits last quarter, and its profit margin was 20 percent -- three times higher than Tata's Indian operations.
Jaguar and Land Rover's record high profits are being driven almost entirely by high demand in emerging markets like China and Russia. Also helping boost sales is high demand for the new Range Rover Evoque. Though profits are high, Reuters reports that Tata Chief Financial Officer C.R. Ramakrishnan did admit they would be "a challenge" to sustain.
According to the report, Tata has also selected a joint venture partner for Jaguar and Land Rover, so the two luxury automakers can expand in the world's fastest growing market. Details on who Tata has partnered with have yet to be revealed, pending approval from the Chinese government. Fueling the rumors, Reuters says that a Chinese newspaper has reported that Jaguar-Land Rover has a verbal agreement to build a luxury car with Chery.