Deadlock in achieving the desired price-quality mix for locally sourced components could also impact Tata’s upcoming EV projects, such as the Avinya
As part of their EV roadmap, Jaguar Land Rover (JLR) and Tata Motors were working on creating synergies that would have benefitted both brands. It included sharing of technology, parts and production facilities. However, latest reports indicate that JLR could have suspended its plans to make EVs in India for global markets. Let’s take a look at the details to understand the potential outcomes.
Supplier issues
As per plans, JLR was to use Tata’s upcoming manufacturing facility in Tamil Nadu to produce its new EVs for overseas markets. These EVs were to be based on JLR’s Electrified Modular Architecture (EMA) platform. Around 70,000 JLR EVs were planned to be manufactured at this facility. Tata’s upcoming premium EV range, Avinya, was also planned to share the same platform and several of the components. Tata was looking to produce around 25,000 EVs in the initial phase.
Work on this new Tata plant had started in September last year. It involves an investment of Rs 9,000 crore. Production capacity is aimed at 2.5 lakh units per annum when fully functional in the next 5-7 years. Tata will be using this facility to manufacture its other cars as well. However, Reuters report reveals that JLR’s talks with suppliers have been suspended, for now. The primary reason is the lack of suppliers who could provide the right price-quality balance, as JLR was expecting.
It is reported that JLR had held a meeting in November last year to apprise local suppliers about its requirement for parts and expected pricing. Suppliers were asked to provide price quotes for the parts needed for JLR’s upcoming EVs. Report reveals that since that meeting, the talks have now been completely suspended. Responding to queries, Tata Motors recently told Reuters that their production plans at the new facility will be aligned with the goals and market requirements of both Tata and JLR. Decisions on the choice of models and launch timelines will be taken to benefit both brands.
Avinya project to be delayed?
It is not certain if this deadlock over finding the right EV parts at the right price is a temporary issue or something that will entail a complete shift in strategy. EV manufacturers across the globe are facing stiff competition from Chinese EV brands. This applies to most EV segments, including entry-level EVs to luxury-class EVs. In this competitive landscape, delays in production and launch plans could have an adverse impact.
JLR’s move could also impact Tata Motors’ ambitious Avinya project. The first model from the Avinya range was planned to debut in 2025. However, that plan has been shifted to 2026. JLR’s recent decision could further delay the Avinya project. If joint production plans with JLR do not work out, Tata Motors may have to introduce the necessary changes to its Avinya lineup.
