TATA-OWNED Jaguar Land Rover (JLR) has signed a joint venture that paves the way for the firm to manufacture and sell luxury vehicles in China, the world’s largest car market.
JLR and Chinese manufacturer Chery Automobile are seeking regulatory approval for the venture, worth around 17.5bn yuan (£1.8bn), they said in a statement yesterday.
The venture, to be located close to Shanghai in Changshu city, will initially make Land Rover SUVs, followed by Jaguars in the second phase.
The joint venture will also set up a research and development facility, and sell vehicles produced by the venture, the car makers said in a joint statement.
Sales in China contributed 17.2 per cent of JLR’s revenue in the quarter to the end of December, more than those in the UK, the birthplace of the two brands.
Revenues from the country are growing at a huge rate, though the Chinese government recently removed the car industry from its list of encouraged industries, making it tougher for foreigners to win new car projects.
“This is an important step for JLR and Tata Motors moving forward,” said Vineet Hetamasaria, car analyst and PINC Research in Mumbai. “Though this is only an agreement, and it will be some time before we see the results.”
Unite the union welcomed the expansion, saying it “once again proves the worldwide appeal of the British car industry”. It added that it has “sought and received assurances that investment and growth in the UK will continue”.