Case Study Jaguar Land Rover

Introduction

This report examines the case study published by the Guardian ‘Jaguar Land Rover to recruit 5,000 staff after record year of sales’. By analysing the causes and implications behind decisions made by the multi-national corporation, this report links in the roles of space, place and actors to explain the importance of ‘institutional thickness’ (Thrift, 1995) for the economic transformation of pro-growth institutions such as Jaguar Land Rover.

Space

Jaguar Land Rover has been owned by Indian Tata Group since 2008 (Dickens, 2015) and is one of the UKs largest exporters with 80% of its revenues generated abroad. Technological change complemented by the ease of capital flows has increased the importance of financial transactions (Brown,

China is the world leading car producer at 24.6%, this gives China power over other countries and companies, allowing the Chinese government to retain bargaining power by imposing specific entry restrictions. China’s government only allow entry of company’s if they are a joint venture (Cumbers, 2011), this way China retains at least half of the profit, showing how power creates a hierarchy and how the economic power is maintained. Chery QQ3 is an example of localisation, as the hybrid model adapts to the Chinese’s cultural and economic needs by producing energy efficient low cost cars, costing less than $5000, applying to the Chinese market. Chery Jaguar Land Rover is an example of strategic coupling as East Asian firms obtain powerful strategic positions within the global market place. Since industrialisation, the state’s role in most East Asian countries is being minimized as the power executed from these global firms continues to shape and control the global economy. (Yeung, 2016) The fast pace of the Chinese economy will be one of the many reasons why JLR have created a joint venture, as well as China being part of the Asian Tigers, being well known for its phenomenal global growth and power since the 1960s. The combination of two strong economies is pinnacle for JLR as it increases revenue and recognition on a global

Import and exports to the EU could face tariffs which could change the whole scope of the company, causing factories to be built elsewhere to try and minimise the effects of the referendum. Another important factor is how the limited migration after Brexit could lead to valuable and talented labour workers being elsewhere. If migrants are unable to work in the UK, they will work elsewhere in the same sector creating higher competition for JLR. The company may need to consider building factories in North America, its second biggest market (Massey, 2018). However, they could be sceptical about this due to factors such as higher minimum wages in America, compared to the low cost labour in the East. Currently, the major implications are yet to come and it will be interesting to see the