By FREDA LEWIS-STEMPEL, MOTORING REPORTER
One of China's largest automotive giants could soon be producing cars in the UK at a Jaguar Land Rover plant, reports have emerged.
Chery - which is China's largest car exporter - is in talks to utilise a JLR site which is operating at 'undercapacity' to build its own brand cars. according to the Financial Times.
Sources familiar with the subject said that the proposals are backed by the UK government, with Prime Minister Keir Starmer discussing the matter during his Beijing visit. The Prime Minister has just arrived in China for a three day visit.
The UK has been actively courting Chery to make its vehicles in Britain for the last few years, the sources said. JLR and Chery have been in partnership since their first joint venture back in 2012.
Deal negotiations are said to be at an early stage and details are yet to be finalised. However, representatives from JLR and Chery will meet during the Starmer's trip to China - the first British Prime Minister to visit the country in eight years.
The move is part of the government's efforts to fix the UK's shrinking vehicle production pattern, with outputs falling to a 73-year low last year to 760,000 units. This is less than half the volume recorded in 2015 (almost 1.6 million).
Such a deal would be vital for the government to achieve its target of 1.3m vehicles produced annually, the reports have claimed.
Chinese automotive giant Chery could produce its cars in the UK and use a domestic Jaguar Land Rover plant to do so, the Financial Times has reported as Prime Minister Keir Starmer arrives in China
Chery's Omoda and Jaecoo brands are the fastest-growing brands in the UK, with Jaecoo recording the largest market share increase of any other mainstream automotive brand in the last decade.
Chery launched in late summer of 2025, with its Tiggo 7 and 8 models.
Omoda launched in August 2024 and Jaecoo in early 2025.
The Society of Motor Manufacturers and Traders (SMMT) puts 2025 vehicle production at 764,715 cars and vans in total.
This is a dramatic fall from the most recent peak of 1.7 million motor volumes. The highest on record was 1.92 million units in 1972.
The government's aim to get to 1.3 million vehicles annually in under 10 years will need a major injection - and Chery moving in to maximise productivity and protect jobs could give UK automotive the bolster it needs.
Peter Kyle, the business secretary, acknowledged that the government wanted Chery to manufacture in the UK and that using an existing JLR plant would be an option.
He told the FT: 'If there is a manufacturing facility where there is sort of undercapacity, then [ . . . ] there is a logic to forming partnerships and that could well form one of them.'
Chery has already acquired a plant in Barcelona from Nissan and recently reached another agreement to buy the Japanese carmaker’s plant in South Africa.
Chery - which is China's largest car exporter - is reportedly in talks to utilise a JLR site which is operating at 'undercapacity' to build its own brand cars. Sources familiar with the subject said that the proposals are backed by the UK government
JLR - which is owned by Tata Motors of India - and Chery have a partnership that dates back to 2012.
The two struck a deal to built a research and development centre and engine production facility in China as part of a licence to manufacture JLR vehicles and new models.
The most recent deal between the teo, announced in June 2024, saw JLR agreed to license its Freelander brand to Chery to develop electric vehicles using the Chinese group’s platform.
Former JLR CEO Adrian Mardell - who was replaced by the incoming PB Balaji in November, had said: 'We believe that working together to develop new models of collaboration for the world’s largest and fastest‑growing electric vehicle market, combined with the appeal of the Freelander brand, promises a very exciting future for CJLR [Chery Jaguar Land Rover].'
Omoda has not ruled out a new plant in the UK, but people close to the company have previously cited high energy and labour costs as the main hurdle to producing locally.
The Daily Mail and This is Money reached out to both Chery and JLR.
Both provided a no comment response.
The This is Money Motoring Club is designed to make car ownership cheaper and simpler for This is Money and Daily Mail readers.
Powered by MotorEasy it's the place to keep on top of tax, MOTs and servicing - and manage the important documents and receipts that boost your car’s value.
You can also save money on maintenance and repairs - and book into one of 10,000 trusted workshops nationwide.
New members receive a £20 reward voucher, which you can put towards repairs or even a warranty - giving you peace of mind that if something goes wrong, you won’t be left footing the bill.
You can even get £20 off an MOT with one of MotorEasy's listed providers.