Jaguar Land Rover plans to electrify its fleet and exit the combustion engine car market in a few years. Taking note of the aggressive electrification in the auto industry, the company plans to invest $18.7 billion to ramp up the development of electric vehicles. The investment should accelerate the company’s plans as it looks to catch up with rivals that have already hit the ground running with a fleet of EVs.
Jaguar Land Rover EV Push
It is not the first time the company has set its sights on the EV space. Upon rising to the helm to become the company’s Chief Executive Officer in 2021, Thierry Bollore rolled out plans to expand the company’s footprint into the production of electric vehicles. At the time, the executive confirmed plans to ditch combustion engine cars in four years.
Confirming the multi-billion investment plan affirms the company’s focus on EVs, which remain hot prospects in the sector. In addition, the company intends to accelerate the development of autonomous driving features that should make its cars competitive in the sector.
Part of the $18.7 billion investment entails converting the company’s UK Halewood plant to focus on producing electric cars. The company is to repurpose the facility after the combustion engine models are phased out. It also plans to reduce and rationalize its non-manufacturing infrastructure as part of a cost-cutting drive. The Land Rover will have its first set of fully electric cars in 2024, with plans to have all Jaguars running on electric batteries by 2025
It is still unclear if Jaguar, owned by India’s Tata Motors, will hit the production targets given its limited experience in making electric vehicles. The company only has one electric vehicle model in a sector where its biggest competitors have already unleashed a fleet of EVs. The I Pace SUV is under construction in Austria by Magna International.
Jaguar Land Rover appears to be late into the party, as the likes of Tesla, General Motors, and BMW are ramping up production with a slew of EV models already in the market. In addition, the companies have gone the extra mile in setting up battery production facilities as they look to produce everything in-house. Some companies have also inked deals with mining companies as they look to secure Lithium supplies highly needed for the development of Lithium-ion batteries for powering EVs.
In the past, Jaguar Land Rover announced it might have to buy EV batteries for powering its cars in the UK to meet local content rules. The move may work to its disadvantage if the batteries in the country are expensive compared to other markets such as China. In addition, it might lack the competitive edge compared to other companies like Tesla that are producing their own batteries.
Nevertheless, the push to exit the combustion engine market underscores the seismic shift fueled by stricter emission rules in the UK and Europe. Governments in the region and worldwide are ramping up pressure against gasoline cars as they contribute a great deal to greenhouse gas emissions. Likewise, they have offered a series of incentives and other aid aimed at forcing automakers to make the big switch.