Tata Motors-owned Jaguar Land Rover (JLR) and Chery Automobile Company said on Wednesday (21 March) they had reached agreement on a proposed joint venture in China, finally confirming local assembly of both JLR- and joint venture-branded vehicles is being planned.
JLR began local Freelander assembly last May at a Tata plant in Pune, India but has officially refused to confirm specifically until today that Chinese assembly is also being considered. Recent reports from the country have suggested the partners may have difficulty getting government approval for such a venture, however. Rival Volvo, like JLR once owned by Ford, is also facing difficulties with Chinese rules.
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“The agreement follows extensive talks between JLR and Chery on establishing an equal partnership company. The scope of the proposed joint venture would include manufacture of JLR- and JV-branded vehicles; establishment of a research and development facility; engine manufacture; and sale of vehicles produced by the JV company,” the two automakers said in a statement.
“JLR and Chery will now follow the official process to establish a joint venture company in China.”
In a joint statement, JLR CEO Ralf Speth and Chery Automobile chairman and CEO Yin Tongyao said: “Working together on this proposed joint venture is an exciting prospect for both [automakers]. Demand for Jaguar and Land Rover vehicles continues to increase significantly in China and we believe that JLR and Chery can jointly realise the potential of these iconic brands in the world’s largest car market.
“Our ambition is to leverage the respective strengths of our two businesses – in research and development; technological innovation; manufacturing excellence and local consumer knowledge- to offer Chinese customers the most advanced, highly efficient products featuring the very latest technologies.”
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In 2005, JLR’s sales in China accounted for 1% of combined Jaguar and Land Rover sales but the world’s largest vehicle market is now JLR’s third largest and growing; annual sales in 2011 increased 60% to 42,000.
Chery Automobile was founded in January 1997 and is based in Wuhu, Anhui Province. Now one of the country’s largest domestic automakers, it is also the largest exporter to over 60 countries. It produces passenger cars, SUVs, engines and transmissions.
In 2011, Chery booked sales of 643,000 units ranking it sixth among passenger vehicle manufacturers in China.
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