Jaguar Land Rover to build two new models in China

New Range Rover
Image caption Jaguar Land Rover has launched its new Range Rover

Luxury car company Jaguar Land Rover has announced plans to build two of its models in China.

It will be the first full manufacturing plant for the company outside the UK.

Although the plans still have to be given final approval by the Chinese government, Jaguar Land Rover has already found a site for the plant, just north of Shanghai.

Chief executive Dr Ralf Speth told the BBC: "We will start with either the Freelander or the Evoque."

But he also confirmed that the Range Rover, and the Range Rover Sport, are unlikely to be built abroad.

"To build the very complex products, we will always be here in the UK," he said.

The Freelander is already assembled in Pune, India from kits sent out from the UK, and the Land Rover Defender is assembled in several locations, including Kenya.

But the Shanghai plant will be the company's first true manufacturing plant abroad, and will use Chinese parts.

The company, which is owned by India's Tata Motors, insists that foreign expansion is no threat to jobs in the UK.

"We are increasing production, not to reduce in the UK, but using the UK base to grow around the world," said Dr Speth.

New Range Rover

The news comes on the same day that JLR launched its new Range Rover in London.

The new car has been five years in the planning, and is only the fourth generation since the original vehicle went on sale in 1970.

Originally marketed as an off-road vehicle, it quickly became popular in urban Britain too, and was one of the first four-by-fours to earn the nickname "Chelsea Tractor."

Its makers claim the new version will be equally popular with those driving to the opera, as well as the "green welly" brigade.

"We still appeal to that core that was there right from the start - the country set," says Land Rover's Design Director, Gerry McGovern.

In an attempt to get away from the previous car's image as a gas-guzzler, the new version is made of aluminium, making it much lighter, and more economical.

UK investment

To build the new car, JLR has invested £370m to upgrade its production facilities at Solihull on the outskirts of Birmingham.

This week some of the first new car bodies were making their way slowly along the production line, watched rather nervously by managers.

The line won't be going at full speed for some time, and customers won't receive the car until early next year.

In the meantime, the company is bullish about the economic benefits it says it passes down to local suppliers.

It is currently spending £800 million with British companies, supporting around 190,000 jobs in the supply chain.

Examples include Johnson Controls, which makes the seats. It has recently hired around 90 staff to help increase production.

And DHL, the logistics company, has taken on around 1,200 new employees to help transport parts to and from the Solihull plant.

Not content with the forthcoming Chinese operation, Jaguar Land Rover is now seriously considering building factories in Saudi Arabia, Brazil, India or Russia.

Markets around the world may be slowing down, particularly in the key region of Europe, where 40% of the company's products are sold.

But Jaguar Land Rover clearly has great confidence in the future.

The fact that so many motorists would love to upgrade to a Sports Utility Vehicle has a lot to do with that conviction.