Jaguar Land Rover strikes £1bn China deal

Michael Bow
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ICONIC British car maker Jaguar Land Rover yesterday said it will start making cars in China for the first time after striking a deal with Chery Automobile Company for a new factory near Shanghai.

The two firms will build the factory in Changshu, in the province of Jiangsu, at a cost of 10.9bn renminbi (£1bn), after winning a licence from the Chinese government to build Jaguar and Land Rover vehicles in the country.

The plant, set for completion in 2014, will include a research and development unit and engine production centre.

The joint venture struck between the two firms, to be called Chery Jaguar Land Rover Automotive Company, will design and build cars specifically focused on the booming domestic Chinese car market. China is already the second largest export market for Jaguar Land Rover, with 51,000 cars sold there in 2011-12.

Jaguar Land Rover chief executive Ralf Speth and Chery boss Yin Tongyao yesterday both praised the “understanding and foresight” of Chinese authorities for giving the firms a licence.

“Together, we will now begin working in close collaboration on our partnership plans to harness the capabilities of our respective companies, to produce relevant, advanced models for Chinese consumers,” they said in a joint statement.

Jaguar Land Rover, which is headquartered in Coventry and owned by Tata Motors, has seen sales of its vehicles boom in China since 2007, when only 3,000 of its cars were sold there.

It currently has a network of factories around the world used to assemble cars from parts shipped from the UK.

The new plant in China will be the first time the firm has designed and built cars abroad from scratch.

The company said China would benefit from investment, job creation and low carbon solutions.