Tata in talks with BMW, Geely over JLR
TATA GROUP IS OPEN TO FINDING PARTNERS FOR JLR TO SAVE ON COSTS AND SHARE THE BURDEN OF INVESTING IN ELECTRIC VEHICLES
Tata group, the owner of Jaguar Land Rover (JLR), has approached carmakers including China’s Zhejiang Geely Holding Group Co. and BMW AG as it seeks partnerships for the beleaguered British automotive business, people with knowledge of the matter said.
India’s largest conglomerate has said it’s open to finding partners for JLR to save on costs and share the burden of investing in electric vehicles. The deliberations were at an early stage and Tata could still approach other potential partners, the people said, asking not to be identified because the information is priautomaker vate. It wasn’t immediately clear how receptive Geely and BMW were.
“There have been no talks with Tata or JLR,” Geely said in a statement. BMW declined to comment, as did Tata, whose chairman has previously ruled out an outright sale of the unit.
Any tie-up with a Chinese could potentially help JLR in that market, where its struggles led to a $3.9 billion writedown earlier this year. Deeper ties between the British luxury brand and BMW would build on an existing collaboration to develop engines and electricdrive technology, though the German carmaker’s former chief executive officer in August ruled out any equity investment.
Scale has become increasingly crucial in the automotive industry as carmakers pool resources to tackle electrification and autonomous driving. The challenge is especially daunting for smaller players such as JLR, which has committed to an ambitious programme to offer electric variants for each of its new models from 2020.
The British carmaker was an early mover among incumbent manufacturers with the electric I-Pace crossover, introduced last year.
“Carmakers need to invest a lot of money in developing new technology, and Tata doesn’t have deep pockets to keep funding development,” said Deepesh Rathore, an independent auto analyst in Bengaluru, India. “You don’t want to be left behind, especially in the luxury segment, and at the same time, Tata doesn’t want to let go of JLR, which is its crown jewel.” BLOOMBERG