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Pimpiri - Mumbai-based Tata Motors opened its first Indian factory on Friday for Land Rover, the formerly loss-making British brand aiming to make inroads into the booming South Asian market.
A Freelander 2 sports utility vehicle was the first to roll out of the assembly plant on the outskirts of Pune, some 100 kilometres (60 miles) from India's financial capital Mumbai.
Production of Jaguars - the Land Rover stablemate bought in the same $2.3bn deal between Tata and Ford in 2008 - is expected to begin at the plant at a later date. Both will be for the domestic market.
"Today is the start of our plan to build a Jaguar Land Rover house in India," Jaguar Land Rover's chief executive Ralf Speth told a news conference.
"India is Jaguar Land Rover's fastest-growing market but we still have some way to go. We will build globally and also expand our product range."
Auto sector analysts say the move will help Jaguar and Land Rover lower costs and become more competitive in India -- the world's fastest-growing major car market - where rivals BMW, Daimler and Audi are already well-established.
Tata announced bumper profits of 92.7 billion rupees ($2.04bn) on Thursday, of which the vast majority - $1.7bn - came from the Jaguar Land Rover (JLR) unit.
Annual unit sales of the brands rose 25% to 243 621, the company said.
Ford offloaded Jaguar Land Rover as part of its restructuring efforts after losing $15bn in two years. In 2007, the British unit sold just 65 500 cars.
While it is now booming under Indian ownership, the new facility - the fifth non-British assembly plant for the group - has raised questions about production at its three factories in its home market.
Tata Group chairman Ratan Tata was recently embroiled in a row about the work ethic of local managers, telling The Times newspaper that "nobody is willing to go the extra mile" at the company or its steel unit Corus.
The company later said he was talking about former managers and was not suggesting they were lazy.
A Jaguar Land Rover spokesperson in Britain said the Pimpri plant would help increase capacity at the Halewood plant in Merseyside, northwest England, so it "will not have any negative impact on jobs in the UK".
Tata Motors sells Jaguar XJ, XF and XK sedans in India in addition to the Discovery and Range Rover SUVs from Land Rover, which are currently imported as complete units and marketed through a network of local showrooms.
Chief executive Carl-Peter Forster has said that India is a "huge market with immense potential" and sees it with China, where Jaguar and Land Rover sales rocketed to 27 500 last year, as a key target for growth.
In comparison, 891 cars were sold in India, Speth told reporters on Friday, without giving previous year figures.
But eyeing India's luxury car market that has recently seen the arrival of Ferrari, Aston Martin and Lamborghini, Land Rover global brand director, John Edwards, added: "It's only a question of time before India explodes."
JLR is beginning to customise its cars to meet Indian needs, offering more space and rear-seat comfort because most luxury cars in India are chauffeur-driven.
Industry analysts say local assembly plants will help Jaguar and Land Rover lower their retail prices by avoiding heavy import tariffs imposed on foreign cars shipped to India.
BMWs, Mercedes and Audi are still more commonly seen in Indian cities than Jaguars or Land Rovers and the companies already have assembly plants in the country.
Forster agreed Friday that assembly in India had a "duty benefit" but said it would not lead to a cut in price.
He also indicated that India could also become an option for making engines and other parts in the future.
