Land Rover Growing in Russia

DETROIT – Land Rover is making inroads into the burgeoning Russian market, a top executive tells Ward’s.

“We’re growing quickly in Russia,” Managing Director Phil Popham says. “Within the next five years, it will be our second-largest market in Europe after the U.K.”

Last year, Land Rover sold 6,500 units in Russia, and the Ford Motor Co. subsidiary expects to increase that number in 2007.

Although he declines to reveal specific sales targets, Popham says Land Rover will “grow substantially” this year, particularly in the eastern cities of Moscow and St. Petersburg.

Referring to Land Rover’s Russian growth strategy as “responsible,” he also says it is largely profit driven.

One advantage for Land Rover in Russia is a consumer base that does not have a long history of vehicle ownership. Many Russians just now are accumulating wealth for the first time. That puts Land Rover in on the ground floor of an emerging market for luxury vehicles.

Land Rover will appeal to wealthy Russians.

“Both Land Rover and Range Rover (brands) are doing very well,” Popham says. “There’s a lot of wealth in Russia. Russians are very brand savvy, because they’re not used to driving cars. It’s an interesting market.”

Currently Land Rover does not assemble cars in Russia, with all vehicles sold there shipped from the U.K. As sales grow, however, the marque may have to reevaluate that strategy, Popham says.

“We’re not building in Russia now, but we’re looking at that,” he says. “We haven’t made any firm decisions. We have to have sustainable growth. So if we were to put down infrastructure, we would have to make sure it’s the right investment.”

One possible option is to utilize Ford’s St. Petersburg assembly plant, Popham says.

Despite the potential for sales growth, there are obstacles, such as the size of the country, itself, which encompasses eight different time zones.

However, that may be less of a hurdle for Land Rover than for volume brands, Popham says. “We can succeed in Russia because we’re a niche, premium brand.”

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