Annual Report 2022
Jaguar Land Rover is in a strong position with a striking portfolio of attractive premium luxury products, a healthy bank of customer orders, low break-evens and the right strategy to support its unique and renowned British brands in a rapidly changing legislative and commercial landscape.
NATARAJAN CHANDRASEKARAN
CHAIRMAN
Recent history has been relentless with the global pandemic, military conflict, growing inequality, supply chain shortages and more. Decades of experience have been squeezed into two dizzying years. Businesses have had to cope with this unprecedented sequence of events with speed and agility. While these changes have had a serious impact on businesses and communities, they have also accelerated some important trends for the future viz.
i) Energy transition – irreversible move to green mobility,
ii) Supply Chain transition – rebalancing of supply chains to become resilient,
iii) Digital transition – Artificial Intelligence and Machine Learning becoming mainstream, and
iv) Talent transition – Coming of age of the Talent Cloud – a diverse, inclusive, global talent pool that can be accessed remotely.
In the midst of these changes, Jaguar Land Rover embarked on the Reimagine journey to embrace an electric future and transform into a digitally savvy modern luxury business delivering strong financial results.
During the year, we saw the successful global launch of the award-winning New Range Rover, while customer deliveries of Defender continued across 94 markets, with 107,208 units sold by the end of FY2021/22.
The global shortage of semiconductors had a disproportionately adverse impact on Jaguar Land Rover’s production and sales compared to our competitors. Even though we took various steps to address the issue, the situation continues to remain challenging. This is a key issue facing Jaguar Land Rover and we are working assiduously to address the same during FY2021/22. This should aid a gradual recovery in performance through the coming year.
The company delivered a resilient performance during the year despite a fall in revenues by reducing their breakeven levels to 320,000 units. While production and sales remained significantly constrained, the business continued to see strong demand for its products, with global retail orders at record levels thanks to strong demand for Defender and New Range Rover.
Revenue fell 7 per cent to £18.3 billion, whilst the company’s EBIT margins fell to negative 0.4 per cent, with lower volumes on working capital in the first half of the financial year resulting in a free cash outflow of £1.2 billion. Retail sales declined 14 per cent for the year.
Recently, the people of Jaguar Land Rover provided timely support to alleviate the humanitarian crisis in the aftermath of the Ukraine/ Russia conflict by mobilising vehicles to support the International Federation of Red Cross and Red Crescent refugee programmes; in raising tens of thousands of pounds through individual donations to aid agencies; and in offering direct support to reunite families.
Looking beyond these near-term challenges outlined above, Jaguar Land Rover is in a strong position with a striking portfolio of attractive premium luxury products, a healthy bank of customer orders, low break-evens and the right strategy to support its unique and renowned British brands in a rapidly changing legislative and commercial landscape. Additionally, Jaguar Land Rover is an important player in the automotive vertical of the Tata Group where we are driving collaboration, knowledge sharing and synergies across our group companies.
I am confident that in the coming years we will be able to realise the full potential of Jaguar Land Rover as it executes its strategy to seize the mega trends described above. I would like to thank all our colleagues and partners for their passion and commitment, as we accelerate, together, towards a successful and peaceful future.
Natarajan Chandrasekaran
Chairman, Jaguar Land Rover Automotive plc
Despite the uncertain environment, I have been tremendously encouraged by our achievements of the past 12 months. As we transform our business, at pace and amid intense external pressures, I am deeply proud of the resilience, energy and unity of our people.
THIERRY BOLLORÉ
FORMER CHIEF EXECUTIVE OFFICER
Fiscal year 2021/22 has been a year of foundational delivery against our ‘Reimagine’ strategy - our roadmap to accelerate our transformation into a modern luxury business, with its supporting transformation plan, ‘Refocus’. We are ready to do more and go faster.
This progress has been achieved in extraordinary circumstances, with our operations disrupted by the ongoing effects of Covid-19 restrictions as well as the industry-wide global semiconductor supply shortage.
While the situation is gradually improving, and we can build more of the cars our customers are waiting for, the repercussions on our results in FY2021/22 are clear.
We are monitoring the Ukraine/Russia conflict very closely. We have witnessed a rapidly developing humanitarian crisis in Ukraine and its neighbouring countries. Our primary concern remains for the wellbeing of our workforce, as well as those within our extended network. I have been profoundly humbled by the compassionate response of colleagues across our business, both directly helping individual families and supporting the ongoing work of the International Federation of Red Cross and Red Crescent Societies.
Despite the uncertain environment, I have been tremendously encouraged by our achievements of the past 12 months.
We revealed two exceptional new models: New Range Rover and most recently, the New Range Rover Sport. Both embody modern luxury and have been loved by our customers around the world.
By the end of March 2022, we had received more than 45,500 customer orders for the New Range Rover. Alongside sustained, significant demand for the Land Rover Defender, this made a record order book during the year, and of course we expect demand to remain very strong.
And as we work relentlessly on Jaguar’s renaissance as an all-electric modern luxury brand from 2025, I can assure you that we are absolutely on track.
Throughout 2021, we increased our capability as an agile, fully data driven, digital business with the creation of InDigital, a key pillar of our Refocus transformation programme. Our 250 specialists focusing on analytics, data science, data engineering and automation have already supported initiatives that have delivered a return of over £300 million value to our business this fiscal year.
Refocus also drives our quality transformation to realise benchmark levels of customer satisfaction. We have seen positive impacts across all our key quality metrics, reflected in improving positions for our brands and products in key customer surveys.
New leadership appointments have strengthened our executive team as we push to bring to life more of our vision, sooner.
François Dossa, appointed to the role of Executive Director, Strategy & Sustainability, will build our capabilities in sustainability, new mobility services and digitalisation, creating new opportunities in connectivity and clean mobility, establishing control points on the new value chain and driving our strategy towards technology leadership.
Lennard Hoornik joined as Chief Commercial Officer, to head all our brand and product marketing and go-to-market strategy.
Thomas Müller, our new Executive Director of Product Engineering, brings invaluable insight in agile principles, advanced driver assistance systems and autonomous driving.
Reimagine also sees us collaborating with leaders in their fields. I was delighted to announce a partnership with NVIDIA - the world leader in artificial intelligence, computing, connected car services, and automated and autonomous driving systems. Together, we can accelerate our in-vehicle software strategy, delivering modern luxury experiences and enabling a true leapfrog in automotive technology.
As we transform our business, at pace and amid intense external pressures, I am deeply proud of the resilience, energy and unity of our people.
Thanks to their commitment, as well as to our growing ecosystem both within and beyond the Tata Group, we have the ingredients to reimagine Jaguar Land Rover and realise its unique potential.
Thierry Bolloré
Chief Executive Officer, Jaguar Land Rover Automotive plc
FISCAL YEAR AT A GLANCE
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While full year financial results reflect the restricted sales volumes, the continuing reduction in our breakeven point through revenue and cost management under our Refocus transformation programme enabled us to achieve positive margins and cash flow in the second half of the fiscal year.
ADRIAN MARDELL
CHIEF FINANCIAL OFFICER
In FY2021/22, we continued to see strong customer demand for our products with a record order bank, however, our sales were constrained by the industry-wide shortage of semiconductors.
While full year financial results reflect the restricted sales volumes, the continuing reduction in our breakeven point through revenue and cost management under our Refocus transformation programme enabled us to achieve positive margins and cash flow in the second half of the fiscal year.
In light of the rapidly developing Ukraine/Russia conflict, we have suspended vehicle sales in the region, and, while the full commercial effects are not yet known, we remain primarily concerned with the wellbeing of our people and our wider network.
Our retail sales were 376,381 and wholesales (excluding sales from our China joint venture) were 294,182 vehicles, down year-on-year 14.4 per cent and 15.4 per cent respectively as a result of semiconductor supply constraints.
Of those retail sales, 66 per cent were electrified, compared to 51 per cent in FY2020/21.
Our order bank grew through the year to reach 168,471 units as at 31 March 2022 including 45,584 orders for the New Range Rover and 40,618 for Defender.
Revenues for the year were £18.3 billion down 7 per cent year-on-year, but average revenue per unit increased compared to the prior year reflecting the prioritisation of higher margin products giving us a strong mix, particularly in the Range Rover and Defender families.
Our loss before tax and exceptional items in FY2021/22 was £412 million. Adjusted EBITDA margin1 was 10.3 per cent (2.5 percentage points lower year-on-year) and adjusted EBIT margin1 was (0.4) per cent (down 3 per cent year-on-year), driven by lower wholesales, offset by increased pricing opportunities, lower incentive spending and a favourable mix.
Refocus delivered £1.5 billion of value, of which over £300 million has been supported by our InDigital team, demonstrating our mission to develop our digital capability, to drive efficiency and ultimately underpin the value creation of Refocus.
We continued to invest in future products with a total of £2 billion spent over the past year, reinforcing our commitment to electrification as part of our Reimagine strategy. Free cash flow1 after investment spending was £(1.2) billion for the year as a whole of which £(1.3) billion was the result of working capital changes largely driven by lower production volumes year-over-year.
We continue to maintain strong liquidity with total liquidity of £6.4 billion at the end of the fiscal year comprising total cash and cash equivalents, deposits and investments of £4.4 billion and £2.0 billion undrawn revolving credit facility (£1.5 billion after July 2022). We issued around £1.4 billion of new debt in FY2021/22 including £800 million (GBP equivalent) of new bonds in the second quarter and a £625 million, five-year loan backed by a £500 million UK Export Finance guarantee in December 2021. After repaying £556 million of existing debt, we ended the year with total debt of £7.6 billion and a net debt1 position of £3.2 billion.
Looking ahead, we expect the ongoing challenges facing the automotive industry to continue. However, with the order book at record levels and new products to come, expected continuing gradual improvement in semiconductor supply and the ongoing execution of the Reimagine strategy and Refocus programme, we expect to build on the improvements in business performance we have seen in the second half of this year.
Adrian Mardell
Chief Financial Officer, Jaguar Land Rover Automotive plc
2021/22 IN FOCUS
Our Reimagine strategy drives our single and clear vision: to become the creator of the world's most desirable luxury vehicles and services, for the most discerning of customers.
This roadmap for the future of Jaguar Land Rover puts quality and sustainability at the centre of everything we do, directed by the simplification of our processes and the rapid electrification of our vehicles, while creating unique customer experiences and a positive societal impact.
As we redefine modern luxury, and with the worldwide customer appetite for electric vehicles, we are accelerating our Reimagine transformation into a business that will deliver double-digit EBIT margins within five years and achieve net zero carbon through our entire value chain, including our products, supply chain and operations, by 2039.
MODERN LUXURY
In 2021, we introduced the New Range Rover, as the embodiment of modern luxury, with breath-taking modernity to its exterior and a highly sophisticated, reductive interior with an intuitive approach to relevant technology.
The New Range Rover embodies a philosophy that will be embedded across our products and our customer experiences, acting as a key differentiator for Jaguar and Land Rover, as part of their transformation into modern luxury brands.
At the centre of this is sustainability, in our vehicles and across the value chain, which we will achieve through electrification; decarbonising our supply chain, manufacturing and nonmanufacturing operations; closed-loop circularity; and in close attention to the provenance of materials we select.
AN ELECTRIFYING, SUSTAINABLE FUTURE
We believe in the modern luxury of pure-electric propulsion that is near-silent, efficient and sustainable. The New Range Rover introduces plug-in hybrid electric propulsion with a segment-leading official electric-only range of over 100km.
From 2024, a pure-electric New Range Rover will join the family.
Over the next four years, Land Rover will welcome six all-electric variants across two architectures – our flexible Modular Longitudinal Architecture (MLA) and Electric Modular Architecture (EMA). This will help us to meet unprecedented policy shifts and an exponential rise in customer demand towards electric vehicles across our key markets. As adoption increases, we expect 60 per cent of global Land Rover sales to be pure-electric by 2030.
As we accelerate Land Rover’s electrification, the renaissance of Jaguar has also been moving at pace.
Over the past 12 months, our Future Jaguar team have determined to develop our own bespoke pure-electric architecture for Jaguar.
Alongside its product transformation, Jaguar is also creating a strong digital culture, efficiently integrating technologies and analytics, to allow the team to design a more rewarding emotional engagement between the brand and the customer.
We are truly excited about the renaissance of Jaguar.
Our ambition to become net zero carbon by 2039 throughout our entire value chain requires a transformation in the way we design, engineer, supply and manufacture our products. To secure our pathway towards this ambition, we have defined and
committed to CO2e reduction targets by 2030, which have been validated by the Science Based Targets initiative (SBTi), aligning the business to a 1.5-degree celsius emissions reduction set out by the Paris Agreement.
TRUE DIGITAL LEADER
Connectivity is a key attribute of modern luxury. Through our Reimagine strategy and Refocus programme, we are creating a step-change in connected experiences for customers and accelerating our transformation into a digital leader in the automotive industry.
We will continue to drive forward connectivity in and with our vehicles, based on our truly market-leading capability today.
Through remote diagnostics and software-over-the-air updates, we can already predict, diagnose and update all major vehicle systems.
To date, we have completed more than 3 million updates on customer vehicles and through our Electric Vehicle Architecture, we can monitor nearly 17,000 data points to continually enhance our customer experiences.
For example, in early 2022, we provided 200,000 customer vehicles, fitted with our advanced Pivi Pro infotainment system, an over-the-air upgrade featuring Amazon Alexa voice AI capability and Wireless Apple Car Play.
We believe this ability for owners to add services and experiences to their connected vehicles will create entirely new value for our business.
COLLABORATING FOR A CONNECTED FUTURE
Such a strong platform for connected services also allows us to reimagine new vehicle features. Collaboration and knowledge-sharing with industry leaders in connected services, data and software development is a cornerstone of our strategy.
We have formed a multi-year strategic partnership with NVIDIA, the leader in artificial intelligence and computing, to jointly develop and deliver next-generation automated driving systems, plus AI-enabled services and experiences for our customers.
From 2025, new Jaguar and Land Rover vehicles will be built on the NVIDIA DRIVE™ software-defined platform – delivering a wide spectrum of active safety, automated driving and parking systems, as well as AI features inside the vehicle.
Together, we will redefine how our customers connect to, and enjoy their vehicles, throughout their ownership, driving new opportunities and business models for us and our partners.
We will continue to strive for strategic partnerships to drive innovation and sustainability in line with our Reimagine strategy.
REIMAGINING FINANCE FOR CUSTOMERS
Through our transformation programme, Refocus, we are also forging strategic partnerships to enhance our purchase experience.
We have partnered exclusively with BNP Paribas, to broaden competitive automotive financing with new, innovative services across nine European markets.
Our ambition is to provide our retail partner network and our customers with an expanded range of financing solutions and insurance products by early 2023.
REDEFINING OUR PURPOSE
Our company purpose sets why we want and choose to exist: ‘live the exceptional with soul’. Through our Reimagine strategy, we are changing to become the ‘proud creators of modern luxury’, guided by a creator’s code - a set of co-created behaviours: customer love, unity, integrity, growth and impact.
Along the way, the positive impact of sustainability and diversity and inclusion will enable us to better understand and serve our customers, fuel our innovation, and engage and inspire our people.
Together, we are shaping a culture of unity, belonging, inclusion and respect, while implementing progressive policies, benefits and support, and engaging with our people to accelerate our progress.
FOCUSED ON THE FUTURE
With Reimagine, we are transforming our business and our two unique brands, with a value-creation approach; delivering modern luxury experiences, quality and profit.
We will deliver a new benchmark in environmental, societal and community impact for a luxury business, creating the world’s most desirable luxury vehicles, against a canvas of true sustainability.
We are transforming into an agile, fully data-driven, digital company, through our Refocus plan. Our commitment to agile ways of working is streamlining our operations and returning value to our business.
Together, we are realising our goals, steadfast in our ambition to be one of the most profitable luxury manufacturers in the world.
Our refocus transformation programme is the engine room powering our reimagine strategy.
Refocus has created significant change within our business and culture over the past year, improving key quality metrics, laying the foundations of an agile, data-driven, digital business, and delivering over £1.5 billion of value during FY2021/22.
Refocus will drive further profitability in our business, as we aim to realise £2.5 billion of value within three years.
The programme contains five priorities focused on improving our operations and transforming our business. These are: improved customer satisfaction, time to market, workforce experience, CO2e reduction and profitable growth.
These priorities are established in ten separate pillars - six operational pillars and four enabling pillars. During this fiscal year, we added our tenth pillar, Sustainability.
DRIVING PROFITABLE CHANGE
Our Quality pillar has implemented new processes and governance to improve quality issues and warranty spend, resulting in an improvement to our customer satisfaction, and reducing warranty spend to £608 per vehicle.
In Programme Delivery & Performance, we have trained morethan 4,000 of our people in agile ways of working, reducing product delivery times and time to market. An Agile Hub has been established, facilitating team training and coaching, as well as redefining the company purpose in the mindset of modern luxury.
In Delivered Cost Per Car, we have continued to build on the successful cost reduction initiatives of our Ignite programme – now extended to 2025 – achieving £1,600 average per car saving, without compromising quality.
We have also created a new Supply Chain function within our business, focusing on digitisation as well as building resilience and sustainability within our operations. This work has included our semiconductor crisis response.
Together, Customer & Market Performance (Pillar 5), which revolutionises our customer journey, and China (Pillar 6) have contributed over £800 million of value through measures including newly digitised ordering for retailers, renewal services for customers and profit and mix optimisations.
DIGITAL TRANSFORMATION
InDigital was launched in April in 2021 as part of our Refocus plan. In just the past year, it has developed into a digital centre of excellence, at the heart of Refocus, with 250 specialists focusing on analytics, data science, data engineering and intelligent automation.
Through a digital revolution in smart tools and processes we supported initiatives that have delivered over £300 million value to our business in FY2021/22, supporting and providing solutions as diverse as supply chain visibility to mitigate the semiconductor crisis; databased failure mode prediction; new and improved customer offerings and customer journey digitisation; and automation across the business for greater efficiency.
RESPONSIBLE SPEND
Responsible Spend continues from the successful Charge+ programme. We have remodelled our approach to spend and investment, updating our purchasing processes, improving cost and time saving allowing our teams to focus on adding value.
SUSTAINABILITY AT OUR HEART
Through FY2021/22, we brought into Refocus a dedicated Sustainability pillar to execute our environmental sustainability strategy - Regenerate.
Regenerate comprises eight distinct focus areas, redefining the way we design, engineer, manufacture and even sell products and services.
Pillar 10 acts as the operational engine to implement this sustainability transformation through climate and circular actions across the company, powered by the adoption of agile methodology.
The transformation of our business through Sustainability is supported by key executive appointments.
François Dossa was appointed to the role of Executive Director, Strategy & Sustainability, in June 2021 and Rossella Cardone became Director, Sustainability in January 2022.
Our journey of transformation has seen us launch breath-taking new products and announce exciting strategic partnerships, while rising to meet the challenges of an uncertain global environment.
THE NEW RANGE ROVER – MODERN LUXURY
In October 2021, we revealed the New Range Rover, a vehicle of breath-taking modernity, peerless refinement and unmatched capability.
Launched with a choice of two wheelbases, four, five, or, for the first time, seven seats and a flagship SV range offering an exquisite interpretation of Range Rover luxury and handcrafted personalisation, New Range Rover is a fully formed family of vehicles, providing more customer choice and scope for personalisation than ever before, with more than 1.6 million different configurations available.
Within six months of its reveal, we had received more than 45,500 advance customer orders for the New Range Rover, and production began earlier this year at our factory in Solihull, UK.
Innovations and technologies that ensure New Range Rover leads by example are protected by 200 new patents filed up to the end of FY2021/22.
SEGMENT-FIRST TECHNOLOGY
Amongst its innovations, our New Range Rover debuted new digital LED lighting technology, with Dynamic Light Projection.
Within each headlight, a core module of 1.3 million individually variable digital micromirrors breaks the light into tiny pixels, to precisely shadow other road users and maximise the amount of light on the road at all times.
At the rear, New Range Rover’s world-first, hidden-until-lit taillights have been specially developed to meet our modernist design philosophy and use vivid red LEDs in operation, yet form a distinctive Gloss Black graphic at the rear when not in use.
POWERFUL CONNECTIVITY
Collaborating and sharing knowledge with industry leaders in connected services, data and software development is a cornerstone of our Reimagine strategy and we announced key strategic partnerships in this area in FY2021/22.
NVIDIA is the world leader in automated and autonomous driving systems and connected car services. Our new, long-term partnership with NVIDIA will accelerate our in-vehicle software strategy, delivering modern luxury experiences.
Utilising our own world-leading Electric Vehicle Architecture, from 2025 new Jaguar and Land Rover vehicles will be integrated with the NVIDIA DRIVETM Hyperion computing and sensing platform, powering advanced technology features and connected experiences, able to be automatically refined and upgraded throughout their lifetime, “over the air”.
This year also saw us deliver the integration of Amazon Alexa voice AI into Jaguar and Land Rover vehicles, contained in the latest upgrades to our award-winning Pivi Pro infotainment technology.
The combined abilities of Alexa and Pivi Pro make our vehicles more intelligent than ever, and into powerful connected devices supporting our customers lives.
Our strategic alliance with Amazon Alexa allows natural voice control of in-car media, navigation and phone services, supported by a rich media display, and connection to other Alexa-enabled devices in smart homes.
This upgrade also demonstrated the connected power of Pivi Pro, in being made available to 200,000 existing customers directly through a software-over-the-air update.
As part of our Reimagine strategy, Pivi Pro represents a step change in connected services capability and will deliver a modern luxury experience for all our customers.
CLEANER CABIN AIR FOR ENHANCED WELLBEING
Cabin air purification research is helping us to reimagine wellbeing for our customers, and to help make a positive societal impact.
Our Cabin Air Purification Pro System, with PM2.5 Filtration, CO2 Management and nanoe™ X air ionisation technology, controls the cabin air quality and significantly reduces odours, bacteria and allergens, including SARS and Covid-19 viruses.
Enhancing our research in this area, in 2021 we partnered with Google to deliver the first all-electric Google Street View vehicle, with the added ability to record air quality. A Jaguar I-PACE, fitted with Cabin Air Purification Pro and an additional sensor array, measured street-by-street air quality in Dublin, using Street View mapping technology.
It recorded levels of nitrogen dioxide (NO2), carbon dioxide (CO2), and fine particles (PM2.5) and also helped to update Google Maps.
Google’s scientific research partners will also analyse the data and develop maps of street-level air pollution.
ON TRACK SUCCESS
Jaguar Racing finished a close second in season seven of the ABB FIA Formula E World Championship, the most successful season so far in its five-year Formula E campaign, with eight podiums, two wins, one pole position and 177 points scored.
Formula E remains a key priority for Jaguar Land Rover, allowing us to test and develop new electric vehicle technologies in a high-performance environment, and help shape our electric future.
Our partnership with Tata Consultancy Services will see Jaguar TCS Racing continue to be a global showcase for our electrification technology and will support Jaguar’s renaissance as an all-electric brand from 2025.
As an official partner of the COP26 climate conference in 2021, we announced new science-based emissions targets and renewed our commitment to deliver a sustainability-rich vision of modern luxury.
Through our committed environmental and social principles, we continue to stitch all the threads of sustainability – from reducing vehicle emissions to circular economy; from manufacturing processes to supply chain partners – with one team, working globally across the business, the brands and the customer experience.
And through our policies towards our people, we are driving a positive societal impact in our communities across the world.
OUR SUSTAINABILITY STRATEGY
Since COP26, in line with our global Reimagine strategy, we have established a dedicated Sustainability Office to lead the sustainability transformation in Jaguar Land Rover, positioning sustainability at the heart of our Reimagine vision and purpose.
Regenerate, our dedicated sustainability strategy, sets the pathway to our ambition to be carbon net zero by 2039.
The strategy consists of eight distinct focus areas: electrification and battery strategy; Materiality and sustainable products; zero impact manufacturing and operations; responsible supply chain management; customers and new business models; environment in decision-making; digitalisation for sustainability; and employees’ cultural shift for sustainability.
These eight areas will enable us to redefine the way we design, engineer, manufacture and even sell our products and services.
The transition to an electric future is integral to our sustainability strategy. Over the next four years, Land Rover will welcome six all-electric variants, with the first arriving in 2024. In this time, Jaguar will have undergone a complete renaissance, emerging as a pure-electric modern luxury brand from 2025.
Beyond EV transition, our Design and Engineering teams are creating new luxury standards using less impactful materials and more recycled content, considering vehicle end-of-life from the start.
And we are supporting customers to make sustainable choices towards less impactful products across their entire lifecycle, coupled with an increased focus on extending product life, and increasing repair, reuse and recycling options.
In Manufacturing Operations and Supply Chain, we are leveraging advanced technologies to reduce energy consumption and waste in our plants and offices.
In addition, our Supplier Environmental and Social Requirements web guide sets out our expectations for our supply base. It covers business ethics, environment, human rights and working conditions, health and safety, and responsible supply chain management.
We also engage with our supply base to enhance the level of sustainability data we receive, to collaborate on sustainability goals, to share information and give feedback so that we can build on the maturity of our suppliers’ sustainability journeys.
The execution of our Regenerate strategy will enable us to achieve our approved Science Based Target initiative (SBTi) commitments by 2030, and to achieve our net zero carbon objective for 2039.
Between 2020 and 2030, we will reduce emissions by 46 per cent across vehicle manufacturing and logistics, and by 54 per cent per vehicle, from purchased goods, services, and use of products.
Having committed to these targets, we are now underway to build a regenerative ecosystem and a sustainability mindset throughout the business. This will help to ensure coordination across departments and allow us to deliver and report on progress against these new targets going forward.
REDUCING OUR VEHICLE EMISSIONS
We are accelerating the reduction in our tailpipe CO2 emissions. We currently offer electric vehicle technology across our entire Jaguar and Land Rover portfolio, including eight plug-in hybrids (PHEV), 11 mild hybrids (MHEV) and our all-electric Jaguar I-PACE.
By FY2025/26, we forecast that approximately 27 per cent of sales will be pure-electric, rising to above 60 per cent by the end of the decade.
In the last year, we have continued to focus on reducing nonessential energy use, as well as further improving transparency in usage data and capturing real time consumption information. The resulting data are showcasing our progression made on waste with respect to energy. Changes to air handling units, shutdown process and equipment replacement has significantly contributed to process efficiency ameliorations.
MATERIALITY - REDEFINING MODERN LUXURY
Our customers want to understand how their vehicle is made, what it is made from and the provenance of materials used.
Materiality is our answer to this - an uncompromised vision of innovation in materials, processes and technology that promotes social, environmental and economic values.
Our Materiality strategy ensures materials used in our vehicles are sustainable, traceable, respectful and without compromise, governed by seven guiding principles: Circularity, Health & Wellbeing, Lightweight, Performance, Provenance, Respectful, and Responsible.
We have already pioneered innovative sustainable materials in Jaguar and Land Rover vehicles. Our Kvadrat interior with natural wool blend utilises 53 recycled plastic bottles and is 58 per cent lighter than a leather equivalent. Ultrafabrics PU, featured in the New Range Rover, is a responsible alternative to leather and represents a progressive approach to luxury materials. It offers all the tactile qualities of leather but is 30 per cent lighter and generates only a quarter of the CO2.
Our Colour and Materials team continue to explore new innovations in Materiality for future products, led by an ethos of ‘aesthetics with ethics’.
HARNESSING BLOCKCHAIN TO TRACE OUR SUPPLY CHAIN
In understanding the provenance of material through our supply chain, we have partnered with blockchain technology firm Circulor, leading UK leather manufacturer Bridge of Weir Leather Company and the University of Nottingham, to prove the use of traceability technology in the leather supply chain.
A combination of GPS data, biometrics and QR codes were used to digitally verify the movement of leather at every step of the process, from farm to our own facilities.
As well as tracking compliance, the secure digital process can assess the carbon footprint of supplied materials and could be deployed to trace a range of commodities. Circulor is already using blockchain to improve the traceability of minerals used for electric vehicle batteries.
This is a key step in our journey to achieving net zero carbon across our supply chain, products and operations by 2039, enabled by leading-edge digital capabilities.
NEW LIFE FOR BATTERIES IN ENERGY STORAGE
We are committed to redeploying and reusing batteries from our electric vehicles and one significant use is in energy storage and demand management.
We have partnered with Pramac to develop a portable zero emission energy storage unit powered by second-life Jaguar I-PACE batteries.
The mobile Off Grid Battery Energy Storage System (ESS) supplies zero-emission power where access to the mains supply is limited or unavailable, with a capacity of up to 125kWh – more than enough to power a regular family home for a week.
Reusing vehicle batteries will create new circular economy business models for Jaguar Land Rover in energy storage and beyond.
MAKING A DIFFERENCE THROUGH GLOBAL BRAND PARTNERSHIPS
Through every partnership, we seek to make a positive contribution to people and communities around the world.
The Red Cross
Our partnership with the International Federation of the Red Cross and Red Crescent Societies has endured since 1954. Throughout this time, we have facilitated life-saving work through funding, vehicles and expertise.
Today, we work together helping people in disaster preparedness, from reaching remote communities with vaccination programmes, to helping distribute tarpaulins for protection against monsoon floods.
During the Covid-19 pandemic, we supplied 267 vehicles to the Red Cross, which covered more than 500,000 miles helping people in crisis.
In addition, we have a fleet of vehicles supporting the International Federation of Red Cross Societies in their efforts to provide humanitarian aid to at-risk communities.
We are also a member of Disaster Relief Alliance, making sure that the Red Cross is ready to support people in the immediate aftermath of devastating crises around the world. Its Disaster Fund assisted six major responses, between April and September 2021.
Dream Fund
Cooperating with the China Soong Ching Ling Foundation (CSCLF), our Dream Fund is the first such activity in China’s automotive industry dedicated to helping children and young people achieve their potential.
Over eight years, we have undertaken a host of initiatives to improve education quality for rural children, guided by the principle of “more equal access”. Our Land Rover Never Stop Caring - Journey for Vision Programme has provided comprehensive healthcare and medical equipment in remote regions of China.
Volunteering for Education
Our sustained programme of education volunteering supports our position as the largest investor in automotive research and development in the UK, by reaching enthusiastic young people with enquiring minds and a commitment to push the boundaries.
Through virtual work experience, school visits and tailored programmes, we enthuse and inspire a future generation of talent, with the aim of overcoming the STEM skills shortage faced by the automotive industry.
This provides our employees with an opportunity to volunteer and share their experiences.
Notwithstanding the Covid-19 restrictions in 2021, 213 employee volunteers, including a core team of apprentices and graduates, provided 881 hours of time to develop the programme, which has so far reached 148 students.
INVESTING IN OUR PEOPLE AND COMMUNITIES
Our people are our greatest asset and that is evidenced by their support to their communities, both individually and through our collective efforts as a company.
Protecting our people
Throughout our response to Covid-19, the health, wellbeing and safety of our people and partners has been our utmost priority and this has continued as colleagues have been returning to offices and workplaces around the world.
As part of our response to the Covid-19 pandemic, we were one of the first businesses and the largest in the UK, to introduce onsite Covid-19 testing.
By April 2022, we had performed 1.68 million temperature tests, 100,000 lateral flow tests, and over 1,000 PCR tests onsite.
In Slovakia, our Nitra facility set up a testing centre for our employees and contractors, providing more than 40,000 tests alone. The Slovakian government acknowledged that Jaguar Land Rover’s mass testing significantly contributed to managing a critical situation and protected the health of our employees, their families and communities.
Beyond testing, we managed a vaccination programme and supplied masks and respirators for our employees. We also created a hub of wellbeing support and information available to all employees throughout the pandemic, including podcasts, resources, and factsheets to help them easily access reliable information at a time of uncertainty.
Hybrid working
Hybrid working reflects our agile working principles and in May 2021, as our employees returned to work in line with the scaling back of Covid-19 restrictions, we formally implemented a hybrid working scheme.
With the trust placed in our people, we have utilised technology to develop a comprehensive scheme that empowers employees with the flexibility to manage their working arrangements and location.
As well as enabling greater productivity and efficiency, hybrid working supports wellbeing, by giving employees more control, choice and flexibility over their working day.
We have committed to support our people both in continued onsite Covid-19 testing and a dedicated workspace booking app, to help them get the most from hybrid working arrangements.
Activities within the community
Our team in Nitra, Slovakia established a partnership with Nitra Volunteering Centre in December 2021 and organised a collection for people in need during December.
Our manufacturing facility in Itatiaia, Rio de Janeiro joined forces with Instituto Toré for a one-year community partnership supporting and implementing two significant social responsibility projects in their local area, aimed at delivering education and skills on conservation and sustainable food production.
In December 2021, employees from Jaguar Land Rover’s UK sites came together to collect for local foodbanks, with the aim of supporting thousands of families who continued to struggle as a result of the Covid-19 pandemic.
The donation drive saw employees across the business support their local charities and communities, with more than 10,000 items such as tinned food and cereals donated to help local families in need, while employees also showed their support by donating just over £2,000 to an online collection fund.
Diversity & Inclusion
At Jaguar Land Rover we are committed to fostering a more diverse, inclusive and unified culture that is representative of our employees, our customers and the society in which we live; a culture where every one of our colleagues can bring their authentic self to work and feel empowered to reach their full potential.
There are tremendous benefits to an environment where everyone feels valued and included. Diversity of thought and experience will be a key driver of our future success as a business: we cannot underestimate the positive impact that diversity and inclusion can have on how we understand our customers, fuel our innovation and, most importantly, engage and inspire our most important asset, our people.
We have identified three strategic pillars to achieve our goal, which will shape our global Diversity and Inclusion activity over the next five years. How they are implemented around the globe will vary and will be driven by the needs of the countries we operate in.
1. Shape a culture of unity, belonging, inclusion and respect
Educate, communicate and measure inclusive behaviours regularly and systematically, improving the employee experience for all.
2. Implement progressive policies, practices, benefits and support
Review and improve practices and policies to remove barriers, enable inclusion and realise equity.
3. Engage our employees and experts to accelerate progress
Collaborate with our networks, colleagues and experts to create real, positive change.
As part of our strategy, by 2026 we aim to have:
• Globally, at least 30 per cent of all senior leadership positions held by females – we will aim to at least mirror this representation at all levels of our business.
• In the UK, at least 15 per cent of all senior leadership positions held by those from Black, Asian, and minority ethnic backgrounds - we will aim to at least mirror this representation at all levels of our business.
• A score of over 80 per cent in our Inclusion Index, measuring the percentage of people who would recommend Jaguar Land Rover as an inclusive employer.
We will continue to measure progress on a number of other metrics as part of our regular employee surveys.