The new generation of London's iconic black cabs will be made in a new factory in the Midlands being built by a Chinese company, creating 1,000 new jobs.
Geely, the Chinese firm which took over the 100-year-old British cab manufacturer Manganese Bronze in 2013, will invest £250m in building a new factory and research and development centre in Coventry to build London's electric and ultra-low emission cabs.
The 85,000 sq metre site near the existing 70-year-old London Taxi Company factory will have the capacity to produce 36,000 vehicles a year, increasing current output ten-fold.
The site will produce the new generation of black cabs being built to comply with new regulations on emissions spearheaded by London mayor Boris Johnson, who welcomed the boost to jobs and economic growth in the capital and the Midlands, as well as securing the long-term future of the taxi industry.
"The production of zero emission capable vehicles, incorporating the latest state of the art technology, is essential as we strive to create the greenest taxi fleet in the world for London," said Johnson. "I warmly welcome Geely’s commitment to building this impressive new factory in Coventry, highlighting the UK’s position as a world leader in the development and manufacturing of ultra low emission technologies."
Li Shufu, founder and chairman of Geely, said: "This investment will secure the future of London Taxi Company. Almost two years after we acquired this company - in which we first took a stake in 2006 - it has become an important part of our global automotive strategy. Today’s announcement symbolises the close business links between China and the UK, which is an attractive market for Chinese inward investment."
The move by Geely is a vote of confidence in both the UK economy and the black cabbies in London who have been under threat from new rivals.
“When Geely first bought the London Taxi Company it initially looked likely to transfer operations back to China," said the Economist Intelligence Unit's auto analyst Ana Nicholls. "Instead, the Chinese carmaker has decided to invest in the existing UK operations. The confirmation that it is planning to build a new factory in Ansty Park will be welcome news for workers and for the region. It also suggests that Geely is not too worried by the threat to London's black cab fleet from apps such as Uber.
Geely's decision to create a research centre at the site is also a vote of confidence said Nicholls, and follows a similar investment of $3.3bn in an R&D centre in Sweden with Volvo, the car division it bought from Ford in 2010.