Power Down: JLR Pulls Plug on India EV Manufacturing

Jaguar Land Rover (JLR) has halted plans to manufacture electric vehicles at Tata Motors' upcoming $1 billion plant in Tamil Nadu, sources said. The decision reflects challenges in balancing cost and quality for locally sourced EV components and a slowdown in global EV demand.

"For India, all JLR electric vehicle projects have been suspended for about two months," a supplier source revealed.

Automakers worldwide are adjusting EV strategies due to rising competition from Chinese brands, shifting consumer preference toward hybrids, and relaxed emissions regulations.

JLR's move is expected to delay Tata Passenger Electric Mobility’s premium Avinya EV launch, as both brands were set to share a platform and supply chain.

Tata Motors began constructing the Tamil Nadu plant in September, targeting an annual production capacity of 250,000 vehicles within 5-7 years. JLR had planned to manufacture over 70,000 EVs there, alongside Tata’s 25,000-unit EV output.

Tata Motors stated that production plans for the new facility will align with its broader strategy and market conditions.

India’s EV market remains in its early stages, with electric cars making up only 2% of the country’s annual 4 million vehicle sales. However, competition is heating up as Tesla prepares to enter the market, and local players like JSW MG Motor and Mahindra & Mahindra expand their EV offerings.

JLR had engaged with Indian suppliers in November to explore EV production and local sourcing, but these discussions have now been suspended. JLR primarily manufactures in the UK, Europe, and China, assembling some models in Pune.

Meanwhile, Tata’s EV unit, which had planned to finalize supplier orders by January, is revising its designs following JLR’s exit from the project. The launch of Tata’s Avinya EV, initially scheduled for 2024, was postponed to 2026-2027, with further delays possible.

Tata Motors reiterated that its product development process involves continuous assessments of design, supply chain readiness, and market viability to ensure a competitive and high-quality offering.

News by Rahul Yelligetti.