Range Rover Evoque has become the largest selling product of Tata Motors' British subsidiary Jaguar Land Rover, after it raced past the 100,000 sales-mark in September this year -- exactly a year after its launch.
About 80 per cent of this was sold to first time buyers of a Range Rover -- the luxury utility vehicle.
The performance of Evoque, the smallest car from the Land Rover stable that competes with BMW X3 and Audi Q5 globally, was a great relief for JLR.
For, it boosted JLR's total sales by 30 per cent to 310,000 units and helped in transforming the loss making iconic British marquee into a cash cow with profit of Rs 12,062 crore (Rs 120.62 billion) in 2011-12.
The year saw China contributing 16 per cent of sales volume, while North America and the UK had 21 per cent and 18 per cent market share, respectively.
JLR has formed a joint venture with Chery Automotive to develop, manufacture and sell vehicles for the Chinese market.
But JLR's global sales leader has been unable to replicate that success in India. It was launched in November last year at a starting price of Rs 42.8 lakh (Rs 4.28 million) with 2 litre petrol and 2.2 litre turbocharged diesel engine options.
Though the India spokesperson for JLR says the success of the Evoque in India (as in the rest of the world) has been due to its unique design, premium technologies and compact size, the fact is unlike its global track record, Evoque is not the best-selling Land Rover brand in India.
The Freelander 2 that is assembled in India continues to be the best selling product of the company at a starting price of Rs 36.9 lakh or Rs 3.69 million (ex showroom Delhi).
The company did not specify the exact number of sales for JLR brands in India.
The reason is simple: price.
The company sells the Freelander 2, Range Rover and Discovery 4 SUVs in India.
But except Freelander 2, all other products are imported as fully-built unit from Land Rover's plant in the UK and invite 114 per cent import duty.
Evoque's competitors have no such problems.
BMW X3, which has an ex-showroom price starting Rs 42.9 lakh (Rs 4.29 million) and Audi Q5 (ex-showroom price starting at Rs 45.3 lakh or Rs 4.53 million) are locally assembled after importing the completely knocked down units.
This means despite being a compact SUV, Evoque costs more.
JLR is aware of the problems.
And that explains the growing buzz that JLR is contemplating CKD assembly of the Evoque in India.
Once this begins, the price is estimated to go down by 25 to 30 per cent, making the vehicle that much more competitive in terms of pricing.
Assembled cars attract a lower import duty of 10-30 per cent.
JLR has 15 retail outlets in 13
As per industry estimates, luxury utility vehicles will account for more than 20 million units sold annually around the world by 2020.
And Land Rover -- the brand that started the whole genre with its Range Rover in 1970 -- seems primed to take its fair share of this growing pie.
In September Land Rover unveiled its fourth generation top-line Range Rover, in Vogue SE and Autobiography trim levels, at the French auto show.
It's the second vehicle in a massive new product strategy started with last year's Range Rover Evoque.
The all new Ranger Rover was launched in India on November 30 at a starting price of Rs 1.72 crore or Rs 17.2 million (ex-showroom Delhi).
It is the world's first SUV under a new light-weight aluminium architecture platform and assembly line.
The new platform has reduced the vehicle's weight by 350 kg, with significant implications on fuel efficiency, power to weight, carbon emission, and pricing.
It helped JLR offer smaller engines on existing Range Rovers, without significant loss of power for the vehicle.
"Making a vehicle light while maintaining safety and comfort is extremely important for fuel efficiency.
"This kind of product strategy certainly helps bring more customers and helping the brand loyalty grow," says Abdul Majid, leader (auto practice) at management consultancy firm PricewaterhouseCoopers.
Gerry McGovern, Land Rover's design director and chief creative officer, in an interview to international media at the Paris Motor Show said "What Evoque has done for us, culturally, is prove you can design things that are incredibly desirable, combined with engineering integrity -- which all of our vehicles have -- for a killer combination."
The Evoque's sales success bodes well for Land Rover.
The late entrants to the luxury-utility scene -- such as Lamborghini, Maserati, Bentley and Aston Martin -- are looking to steal as many potential Land Rover customers as they can.
And to counter these new threats, a raft of new Land Rovers is in the works.
The company is now expected to launch Range Rover Sport, from the new platform in September 2013, followed by Discovery in September 2014.
Eventually Defender is also expected to move to the new platform.
Over the next three years, the company is also planning to strengthen its position in the smaller engine lower priced vehicle segment where rivals BMW and Daimler have higher exposure.
"We believe JLR is on the right strategic path and is investing in the right areas, resulting in its evolution to a much stronger and balanced player in the luxury vehicle market," says Jinesh Gandhi, analyst with Mumbai based brokerage Motilal Oswal in his recent note.