Jaguar Land Rover EV Manufacturing Plans in India Halted?

Tata Motors and Jaguar Land Rover (JLR) are facing a deadlock due to difficulties in achieving the desired price-quality mix for locally sourced components, which has led to the suspension of JLR’s EV production plans in India.

The goal of Jaguar Land Rover's (JLR) and Tata Motors' EV plan was to develop synergies that would have benefited both companies by sharing production facilities, parts, and technology.

However, according to the Rush Lane report, JLR may have halted its plans to produce EVs for international markets in India due to supplier side problems.

According to Rush Lane, JLR was planned to manufacture its new EVs for international markets at Tata's soon-to-be Tamil Nadu manufacturing plant. JLR's Electrified Modular Architecture (EMA) platform was to serve as the foundation for these EVs. This factory was supposed to produce about 70,000 JLR EVs. The Avinya, Tata's next luxury EV line, was also supposed to use the same base and a number of the same parts. In the first phase, Tata aimed to create about 25,000 EVs.

In September of last year, development on this new Tata facility began with an investment requirement of Rs 9,000 crore. When fully operational in the next five to seven years, the production capacity is targeted at 2.5 lakh units annually. The factory will also be used by Tata to produce its other automobiles. However, according to a Reuters story, JLR has temporarily halted its negotiations with suppliers. The main cause is the dearth of providers who might meet JLR's expectations for the ideal price-quality ratio, the report added.

Rush Lane further highlighted that in November, JLR conducted a meeting to inform local suppliers of its component needs and anticipated costs. For the parts required for JLR's next EVs, suppliers were asked to submit pricing bids. According to the report, all conversations have been halted since that meeting.

In response to questions, Tata Motors recently told Reuters that their production plans at the new facility will be in line with JLR's and Tata's objectives and market demands. To benefit both companies, decisions will be made about model selection and launch schedules. Whether the Avinya project will be delayed or not is not certain yet as the deadlock of finding the right EV components and at the right cost may be a temporary issue or may demand a strategy shift, Rush Lane added.