On September 7th, Jaguar Land Rover (JLR), which sold nearly 600,000 vehicles in 2016, announced that as of 2020 every new car they produce will be either fully electric or a hybrid. It follows in the wake of Volvo, who sell a similar number of vehicles, who announced that they would be down the same from 2019.
It is a strong move and one that makes a huge amount of sense in the current market, where the electric car market is increasing in popularity. The recent Frankfurt motor show was also dominated by companies like BMW, Audi, and Mercedes, all of whom unveiled new electric cars. With Nissan also launching their new Leaf, the most popular electric car in the world, and Tesla also beginning production on their Model 3, there is now a huge variation of electric cars to choose from across a huge variety of budgets.
Many have described the move to only producing electric and hybrid as an innovation, but is it really?
The move by JLR is one that has some incredibly important benefits, not simply in terms of the optics and practicalities of moving away from fossil fuels, but also in the fact that they produce one of the most prestigious cars in the world - the Range Rover. Jay-Z even rapped about the car in his 1998 song Imaginary Player, when he compared the difference between a 4.0 litre and 4.6 litre version. Celebrities from David Beckham through to Madonna have one, and even the Queen of England famously drives one. With this car that is synonymous with celebrity, wealth, and status available in only electric or hybrid, people will see the most photographed people in the world using this technology.
This will have a huge impact in the same way that seeing celebrities using iPods in the mid 2000’s was one of the key reasons why Apple became so successful and allowed them to push on and create the world-changing iPhone. The success of this phone then saw other follow suit with their versions, which until now saw the majority of phones used in the developed world use broadly similar technologies. Could this move eventually see a similar thing happening with cars?
It is also a smart business move, as the market is clearly heading towards an electric future with a very clear upwards curve towards 2040, where Bloomberg predict that 35% of all new vehicle sales will be of electric cars. A key turning point is going to be 2022 when electric cars are projected to cost the same amount as internal combustion engine models. With this move taking place 2 years prior, JLR are positioning themselves to take advantage of the changing markets and aligning themselves with a technology that is very much in the ascendency.
In addition to that it gives the brand a potential new user base given the optics of the move. At present JLR cars are seen as luxurious but ultimately very polluting, with MPG considerably higher than most other cars, especially in Europe and Asia. Through transferring all cars to become more environmentally friendly, one of the key stigmas that surround the brand will disappear, making it more appealing to the growing number of consumers who make purchases for environmental reasons.
However, whilst each of these points shows that JLR are making an intelligent and informed decision that will benefit them in the future, this is not an innovative decision. Rather than creating something new, it is instead reacting to the market and pre-empting future growth. Describing this as innovation may be something that some would be comfortable with, but the reality is that this has more to do with market positioning than innovation.
Rather, a development that has had a fraction of the same coverage may well be the real innovation; the Jaguar E-Type Zero. This is the famous Jaguar E-Type, which has been retrofitted with an electric drivetrain to bring what Enzo Ferrari referred to as ‘the most beautiful car in the world’ into the 21st century. The idea is relatively simple and given that it is currently a concept car, limited in scope, but nonetheless it shows a strong level of innovative thinking. Through bringing electrification to classic cars, Jaguar is showing that retrofitting this technology is possible on even the most beautiful cars from over 50 years ago.