In a historic reversal of roles, the British automaker will cede idle assembly lines to manufacture Asian models and avoid taxes
Chery and Jaguar Land Rover (JLR) have taken a definite step to deepen their industrial cooperation. The Chinese automaker has confirmed that it will use JLR’s historic factories in the UK to produce its vehicles, initially focusing on the Omoda and Jaecoo brands. The move marks a reversal of roles in the global auto industry, with an Asian giant using the spare capacity of a traditional European manufacturer to expand its presence in the West.
The strategic decision tackles two simultaneous problems: it allows Chery to circumvent tariffs and trade barriers imposed on vehicles imported from China and, at the same time, fills JLR’s assembly lines, which operate below full capacity.
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Although the announcement of production on British soil is surprising, the relationship between the two companies is not new. Chery and Jaguar Land Rover have had a joint venture in China for 12 years, where the Asian automaker manufactures models such as the Range Rover Evoque and Land Rover Discovery Sport for the local market. Now, the logic is reversed: the United Kingdom will serve as a platform for the Chinese to export to all of Europe.
The Omoda and Jaecoo models that will come out of the British lines should focus on hybrid and electric powertrains, in line with the continent’s environmental requirements. It is speculated that the Halewood plant, where JLR already produces entry-level models, will be the main stage for this new phase.
By nationalizing production in the United Kingdom, Chery avoids import duties that would take away the competitiveness of its products against European rivals. For JLR, the agreement is a guarantee of maintaining jobs and diluting fixed costs, proving that, in the current scenario, the survival of traditional brands can depend on the capital and volume of the new Eastern powers.
