Jaguar Land Rover has put a stop to its EV Production Plans at Tata’s $1B Factory in India

According to recent news, JLR has decided to stop their EV production in Tata’s new $1 billion plant in Tamil Nadu, India. The JLR has opted for this decision because the British manufacturers were facing difficulties in assembling locally produced EV parts, for pricing their cars competitively. In addition, the slow demand for electric cars globally has also led to JLR’s decision to stop their production. 

Factors Leading to the Standstill

According to the sources from the company, the biggest issue JLR was dealing with was the allocation of local EV components that could help JLR to price their EVs competitively. 

The financial dynamics of Indian electric vehicle manufacturing did not unfold as the industry had hoped. These are some reasons why JLR has dropped their plans to make EVs in India from the last two months. 

Not only JLR, several car manufacturers are reconsidering their strategies for producing EVs due to increased rivalry from Chinese manufacturers, growing popularity of hybrid cars, and changing government roles in regulating carbon emissions. 

Impact on Tata Motors' Strategies

This strategic shift of JLR has also impacted Tata Motors strategy to introduce their all-electric lineup of cars. Tata’s EV division wanted to integrate the same platform as JLR’s electric cars into their premium Avinya Models, as many parts were scheduled to be sourced from the two companies, the production halt in JLR will also result in the delay of Tata’s timelines to introduce the Avinya models, displayed at the Bharat Mobility Auto Expo. 

The Tamil Nadu factory of Tata Motors is still not complete and will start its operations soon. The facility has the capability of producing 2,50,000 cars in a year, which is quite substantial. But this move by JLR will surely impact Tata’s plans of manufacturing their electric cars. 

Rising Demands in the Indian Electric Vehicle Market

Today Tata Motors is a market leader in India's growing EV market. However, Tata is also facing stiff competition from other emerging EV brands like MG Motors, Mahindra, and even Tesla, which is at the final stage of entering into the Indian market. 

The Indian EV market is exponentially growing, thus Tata and JLR have to meet the rising demand of EVs in the country and adjust according to the changing tastes and preferences of the consumers, in order to boost their sales. 

However, Tata is quite positive about this approach and has indicated that the production duration and their EV car manufacturing at the new plant will follow the overall market strategy of Tata and JLR. But due to JLR’s absence, Tata’s own EV manufacturing plans are delayed at the moment, and needs to be revised to increase the production.