India-UK FTA unlikely to have major price changes in JLR vehicles

FTA is unlikely to be a game-changer, but it will be a decent boost to JLR’s sales in India

While British luxury carmaker Jaguar Land Rover (JLR) says that a tariff reduction for its vehicles is expected over time, experts do not anticipate a major reduction in prices in India. 

Tata Motors-owned JLR has not yet decided on reducing the vehicle prices. 

“We welcome this free trade agreement between the UK and India, which over time will deliver reduced tariff access to the Indian car market for JLR’s luxury vehicles. India is a key market for our British-built products and represents significant future growth opportunities,” a JLR spokesperson told businessline.

Experts have pointed out that over 60 per cent of the company’s vehicles are assembled in India and the FTA agreement would not have significant changes. 

“For Jaguar Land Rover , while the agreement offers some relief on import duties, particularly for their fully imported high-end models like the flagship Range Rover and SV variants, the overall impact remains modest. 60 per cent of JLR’s India sales come from locally assembled CKD models which already benefit from lower duties and are not significantly affected by the FTA,” said Anurag Singh, Advisor, Primus Partners to businessline. 

JLR recently slashed its earnings before interest and taxes (EBIT) margins for FY26 to 5- 7 per cent, on risks arising from US tariffs, transition to battery electric vehicles and a cloudy outlook for the Chinese market. 

“In FY25, JLR India reported record sales of 6,183 units, a 40 per cent growth year-on-year, aligning with the brand’s global upward trajectory of 431,733 vehicles globally. However, the FTA is unlikely to be a game-changer, but it will be a decent boost to JLR’s sales in India. Its benefit is largely limited to a premium subset of buyers, and any substantial shift in JLR’s India operations or pricing strategy is unlikely in the near term,” added Singh . 

JLR had earlier forecasted an EBIT margin of 10 per cent. The company has stated it will increase its market activation and reroute demand to other parts of the world.

“These challenges all have the potential to impact EBIT. We are focusing on building our resilience,” the company had said in an investor presentation.

JLR will also begin operations of its completely knocked down (CKD) vehicles from the Ranipet plant in Tamil Nadu from early 2026.

The company locally manufactures Range Rover and Range Rover Sport in India. 

With the India-UK FTA, the customs duties on luxury cars are likely to be softened, boosting market access for UK exporters to enter the Indian automobile market.

“The automotive sector presents a more nuanced picture. The FTA introduces a quota-based system under which tariffs on UK-manufactured cars will be reduced from over 100 per cent to 10 per cent. While this opens up the Indian market to high-end British vehicles, it also raises concerns about the competitive pressure on India’s domestic auto industry. However, the agreement also facilitates easy export of Indian-made auto components and machinery to the UK, potentially boosting India’s manufacturing base and supporting its ‘Make in India’ agenda,” said Anand Ramanathan, Partner and consumer industry leader, Deloitte South Asia.

Published on July 25, 2025

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