JLR Expects Average Selling Price Above £80,000, Targets Double-Digit Revenue Growth

Jaguar Land Rover expects its average selling price to move well beyond £80,000 per vehicle over the next 18 months as it targets double-digit revenue growth over five years.

The Tata Motors-owned luxury carmaker is placing North America at the centre of its growth plans while working to deliver £1.7 billion in savings over two years. A greater contribution from Range Rover, Range Rover Sport and Defender is expected to support revenue and profitability.

The targets follow a difficult start to FY27. JLR’s revenue declined 9.6% year on year to £5.97 billion in the quarter ended June 30, 2026, after wholesales fell 9.2%.

Adjusted EBIT margin narrowed to 2.8% from 4% a year earlier. Profit before tax and exceptional items declined 68.9% to £109 million, while free cash flow was negative at £998 million.

Production was disrupted by a fire at a major component supplier, while the conflict in West Asia affected sales. The planned run-out of outgoing Jaguar models also pulled down volumes.

JLR retained its FY27 guidance despite the weaker quarter.

“The results, whilst weaker than we would have liked, are not inconsistent with our full-year guidance,” JLR Chief Financial Officer Richard Molyneux said during Tata Motors Passenger Vehicles’ Q1 earnings call.

“It will, however, require strong performance for the remainder of the year,” he added.

North America Moves Up the Agenda

JLR expects North America to account for a significant part of its targeted growth. The region’s preference for large luxury SUVs and the established presence of Range Rover, Defender and Jaguar make it a priority market for the company.

Management said the US accounts for around 40% of the world’s millionaires, providing a large customer base for JLR’s high-value vehicles.

“Our focus is the US market for a significant part of that,” Molyneux said, referring to the company’s growth plans.

JLR also intends to vary its powertrain mix across regions. It expects to sell more combustion-engine vehicles in North America, while initially directing a greater proportion of its battery-electric models towards the UK and Europe.

“We will sell progressively more ICE in North America, progressively more BEV in the UK and in Europe,” Molyneux said.

The increased focus on North America comes as JLR faces continued pressure in China. Wholesales in China declined 25% year on year during the first quarter, making it the company’s weakest major market.

JLR said economic conditions, pressure on retailers and changes to luxury taxation had made the market more difficult. It is working to control retailer inventory and concentrate demand-generation efforts on Range Rover, Range Rover Sport and Defender.

Management cautioned that conditions in China may not yet have bottomed out.

£1.7 Billion Savings Over Two Years

JLR has identified £1.7 billion in savings over two years under its Enterprise Missions programme.

The initiative will focus on the ex-works cost of vehicles, warranty expenditure and the company’s fixed-cost base. JLR plans to provide more details with its second-quarter results.

“You cannot shrink or save yourself to success. You have to grow and leverage scale,” Molyneux said.

JLR is approaching the peak of its current investment cycle. Spending is expected to remain at similar levels over the rest of FY27, although the mix will shift from engineering expenditure towards capital investment as new facilities come on stream and series production begins.

The company reported a capitalisation rate of 74% in the first quarter as investment remained elevated ahead of its next product cycle.

Average Selling Price Set to Rise

JLR expects its average selling price to move well beyond £80,000 over the next 18 months as the share of its most expensive models increases.

“This is the trend in our average sale price, continually rising and set to rise further as we launch our new products,” Molyneux said.

Range Rover, Range Rover Sport and Defender accounted for 80.8% of JLR’s wholesale volumes in Q1 FY27, up from 77.2% a year earlier. The richer mix partly cushioned the effect of lower overall volumes during the quarter.

JLR also pointed to vehicle residual values as an indicator of pricing strength. Management said Range Rover and Defender led their respective segments on residual values in the US, while Range Rover and Range Rover Sport held the top positions in the UK.

However, the shift towards higher-value models has not insulated the company from tougher trading conditions. Retail variable marketing expenditure, which includes incentives, increased to 7.1% in Q1 from 4.1% a year earlier.

China accounted for a significant part of the increase. Incentives also remained elevated in the US compared with the corresponding quarter last year, when JLR had deliberately restricted sales allowances following the introduction of higher tariffs.

JLR’s challenge is to accelerate growth without diluting pricing as it recovers from the softer first quarter. That will require a turnaround in operating performance even as China remains under pressure and investment stays elevated.