China’s fast-growing automaker Chery could soon manufacture vehicles at Jaguar Land Rover facilities in the United Kingdom, according to a major report by the Financial Times. While discussions are still at an exploratory stage, the development highlights a potentially significant shift in how Chinese carmakers establish a manufacturing footprint in Europe.
The move comes at a time when Jaguar Land Rover is facing substantial excess production capacity in the UK, following Jaguar’s decision to end internal combustion engine (ICE) vehicle production in December 2025. Jaguar’s next phase will focus on ultra-low-volume, high-priced electric vehicles, leaving large portions of its manufacturing facilities underutilised.
Excess Capacity Opens the Door for Chinese Automakers
With Jaguar’s transition to an all-electric future still some distance away in terms of volumes, JLR’s UK plants could offer Chery an immediate solution to manufacture vehicles locally. From a strategic standpoint, this could help JLR improve factory utilisation while allowing Chery to sidestep tariffs, logistics costs and political pressure associated with importing vehicles from China.
Reports suggest that the UK government is supportive of such an arrangement. Officials have reportedly been courting Chery for years as part of broader efforts to revive domestic vehicle manufacturing and meet long-term production targets of around 1.3 million vehicles annually by 2035. UK vehicle output in 2025 stood at just 738,000 units, underlining the scale of unused capacity across the industry.
A Partnership That Already Exists
Jaguar Land Rover and Chery are no strangers to each other. The two companies formed a joint venture in China back in 2012, which led to the establishment of the Changshu manufacturing plant. More recently, in 2024, JLR licensed the Freelander nameplate to Chery for use on electric vehicles developed using Chery platforms.
This existing relationship could ease negotiations if the companies decide to move forward with UK-based manufacturing. Reports indicate that discussions took place during UK Prime Minister Keir Starmer’s visit to Beijing, though both UK and Chinese sources stress that no formal agreement has yet been signed.
Chery’s Rapid Growth in the UK
Chery’s brands are already gaining strong traction in the UK market. While Chery-branded vehicle registrations stood at around 5,500 units last year, its sub-brands Omoda and Jaecoo together accounted for over 48,000 registrations. Combined, Chery Group vehicles outsold several established European and Japanese brands in the UK, underlining how quickly Chinese manufacturers are gaining ground.
Setting up local manufacturing could further strengthen Chery’s position in Europe, especially as EU tariffs on China-made EVs push automakers to explore alternative production strategies. Talking about strategies, Chery will reportedly be entering the Indian market soon, via a partnership with JSW Motors.
Wider Implications for the European Auto Industry
If confirmed, this development would mark a notable moment for the European automotive landscape. It would see a Chinese automaker using legacy European manufacturing infrastructure, rather than building greenfield plants from scratch. Similar trends are already emerging elsewhere, with Chinese brands partnering with or acquiring facilities from global automakers in Spain, South Africa and beyond.
For Jaguar Land Rover, which is owned by Tata Motors, the move could provide financial and operational relief during a challenging transition period that includes heavy EV investments and recovery from a costly cyberattack in late 2025.
