Chery-Jaguar Land Rover JV gets go ahead in China

The Chinese government has given approval for the joint venture worth 1.89 billion USD between Jaguar Land Rover (JLR) and Chery automobiles to jointly setup a manufacturing plant in the peoples’ republic.

The joint venture will include the establishment of an R&D centre and a manufacturing unit at Changshu in the eastern province of Jiangsu. The facilities are expected to start operations in 2014.  Under the JV, 1.3 lakh vehicles will produced of which most are expected to be Jaguar and Land Rover models, both of which are extremely popular in China. JLR will also work on co-branded cars, as it is part of the mandate for setting up a facility in China.

What is amazing is that the deal was approved by the Chinese government in just seven months rather than the standard time of one year. JLR has attributed this to Chery’s familiarity with the procedures involved in establishing a JV.

China is one of the fastest growing automobile markets in the world and is a bigger contributor to JLRs revenues. The new venture in all possibilities will boost balance sheet of JLR’s parent company, Tata Motors.