According to a Reuters report, four sources have revealed that British luxury automaker Jaguar Land Rover (JLR) has shelved its plans to produce electric vehicles at a factory owned by its parent company, Tata Motors. The factory, set to be built in southern India, represents a $1 billion investment by Tata Motors.
Three of the sources stated that JLR was unable to find a balance between cost and quality for locally sourced electric vehicle components in India. Additionally, the sources noted that JLR's decision to halt its EV plans reflects the broader slowdown in global demand for electric vehicles.
A source from an automotive parts supplier stated, "For India, all work related to Jaguar Land Rover's electric vehicles has stopped. Everything was put on hold about two months ago."
Sources also indicated that JLR's decision is expected to delay Tata Passenger Electric Mobility, Tata Motors' domestic EV division, from launching its first premium model in the Avinya series. These models were initially planned to share the same platform as JLR's electric vehicles, with some components sourced jointly.
Tata Motors began construction of this new plant in September last year. The facility, besides producing electric vehicles, will also assemble other types of vehicles. Once fully operational in five to seven years, its annual production capacity is expected to exceed 250,000 units. Sources said JLR had originally planned to manufacture over 70,000 electric vehicles at the plant, while Tata's EV division aimed for 25,000 units.
In a statement to Reuters, Tata Motors said that the production timeline and model selection at its new plant in Tamil Nadu, India, will align with the overall strategy and market demand of both Tata Motors and JLR.
"As part of our rigorous product development process, we continuously evaluate key factors such as design, supply chain readiness, and unit economics to ensure we deliver competitive and high-quality products," Tata Motors stated.
In November last year, JLR held a meeting with local automotive suppliers in Mumbai, India, where it shared details of its EV production plans and discussed local procurement of components. Sources disclosed that JLR had asked some suppliers for preliminary pricing information at that time, but these negotiations have now been suspended.
JLR's main production operations are concentrated in the UK, much of Europe, and China, but some of its models, such as the Range Rover SUV, are assembled at Tata Motors' Pune plant in Maharashtra, India.
Two sources noted that Tata's EV division had originally planned to finalize component orders with suppliers by the end of January, but the withdrawal of JLR has led to design adjustments, as the economic viability of the project no longer meets expectations.
In January, Tata Motors postponed the launch of its Avinya electric vehicle from the originally planned 2025 to "2026-2027." It remains unclear whether the current situation will cause further delays.
Global automakers are now adjusting their electrification strategies in response to increasing competition from Chinese firms, strong market demand for hybrid vehicles, and relaxed government targets for carbon emissions and EV sales.
As the leading automaker in India's emerging EV market, Tata Motors is facing growing competition from rivals such as JSW MG Motor and Mahindra & Mahindra, both of which have introduced new models with longer range and more advanced features.
Additionally, Tesla is finalizing its plans to enter the Indian EV market. India, the world's third-largest automobile market with annual sales of four million vehicles, currently has an EV penetration rate of only about 2%.
