Jaguar Land Rover has said it will invest £15bn over five years as Britain’s largest car-making employer upgrades its factories to produce electric vehicles, including its first UK-made battery car.
The company will shift production to electric cars at its plant at Halewood on Merseyside, while its factory making internal combustion engines in Wolverhampton, in the West Midlands, will focus on producing electric motors and associated parts.
JLR, which has 36,000 employees, said the £15bn would be spread over its “industrial footprint, vehicle programmes, autonomous, AI and digital technologies and people skills”, although did not set out how the money would be split.
The UK car industry will welcome the investment. Although it is owned by the Indian conglomerate Tata, JLR is the sole mass-market carmaker headquartered in Britain, and only Japan’s Nissan made more cars in UK factories in 2022.
Analysts have long been waiting for information on how JLR would meet its commitments to make Jaguar an all-electric brand by 2025, and to achieve zero carbon emissions by 2039. Some experts have criticised the company for falling behind in the race to produce electric vehicles. Its only fully electric car is the award-winning Jaguar I-Pace, which is built in Austria by a contract manufacturer.
JLR has also struggled more than some rivals to find enough semiconductor computer chips for its cars during a global shortage, which has held back its output and slowed its return to profitability after years of losses.
The company announced on Wednesday that its first UK-made electric car would be a £100,000 Jaguar four-door “grand tourer” built in Solihull in the West Midlands. The first deliveries will be in 2025. Design chief Gerry McGovern said the Jaguar brand had been “radically reimagined” and would be built from a separate blueprint to the other models.
JLR will also open orders for the first electric version of its Range Rover, its flagship vehicle. It has decided not to build hybrid versions – which combine a petrol engine with a battery – of its medium-sized Range Rover models, focusing instead on batteries “as the trend to electrification in certain markets increases”.
JLR’s chief executive, Adrian Mardell, said the company was “accelerating our electrification path, making one of our UK plants and our next-generation medium-size luxury SUV architecture fully electric”.
David Bailey, a professor of business economics at the University of Birmingham, said the size of the planned investment was welcome for the British car industry.
“They’re finally really speeding up the electrification, both on the Jaguar but also on the other brands” including the lucrative Range Rover, a “big earner” for the company, he said. Bailey added that the separate blueprint for Jaguar “does raise the question of whether they will spin it off” as a separate company if its relaunch is successful.
JLR has signed supply agreements for the batteries for its first wave of homegrown electric models, but it is waiting for a decision from Tata on where the parent company will build its own battery cell factory.
Tata’s decision is seen as hugely important for the health of the broader UK car industry, after the collapse this year of the startup Britishvolt, which had intended to build a so-called battery gigafactory. Tata has lobbied for as much as £500m in government support for a battery plant in the UK, and it is also considering a site in Spain.
Mardell said Tata’s decision was imminent, but that it would take at least four years for a new gigafactory to be up and running.
Mardell said the plan was part of the strategy launched two years ago by his predecessor, Thierry Bolloré, who left JLR in November. The company cited “personal reasons” for the surprise departure. Mardell had been appointed as interim chief executive, but his permanent appointment was confirmed on Wednesday.
Mardell said: “Two years ago, we launched our Reimagine strategy and since then we have made great progress, including launching two new critically acclaimed modern luxury Range Rover and Range Rover Sport models, joining the Defender family, for which there is record demand.”
• This article was amended on 20 April 2023 to clarify that the Jaguar I-Pace is still being produced; an earlier version indicated that this was not the case.
