Jaguar Land Rover (JLR) has suspended plans to manufacture electric vehicles at Tata Motors’ upcoming $1 billion factory in southern India, citing challenges in balancing cost and quality for locally sourced components, four sources familiar with the matter told Reuters.
“For India, all the work (on JLR electric vehicles) has stopped. Everything has been suspended since about two months,” said a supplier source.
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JLR’s decision reflects broader industry trends, as global automakers adjust their electrification strategies amid rising competition from Chinese manufacturers, shifting consumer demand toward hybrid vehicles, and revised government policies on EV adoption. According to the sources, the move is also likely to delay Tata Passenger Electric Mobility’s plans to introduce its premium Avinya models, which were designed to share a platform and components with JLR’s EVs.
Tata Motors, India’s top EV maker, began construction of the new plant in Tamil Nadu in September, aiming to produce 250,000 vehicles annually at full capacity. The initial blueprint included over 70,000 JLR electric cars and 25,000 Tata EVs, but the project has now stalled.
Tata, in a statement to Reuters, said that production timelines and model selection at the facility would be determined by the company’s “broader strategy and market requirements.” The automaker is facing intensifying competition from JSW MG Motor and Mahindra & Mahindra, which have launched new electric models with extended driving ranges. Tesla is also finalizing plans to enter India’s rapidly growing automotive market, where EVs currently account for only 2% of total annual sales.
JLR, which primarily manufactures its vehicles in Britain, Europe, and China, assembles some models at Tata’s Pune plant in Maharashtra. In November, JLR hosted a meeting with suppliers in Mumbai to discuss local component sourcing. However, those discussions have been suspended.
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Tata’s EV division had initially planned to finalize supply agreements by January but is now reevaluating its designs. “As part of our rigorous product development process, we continuously evaluate key factors such as design, supply chain readiness, and unit economics to ensure a competitive and high-quality offering,” Tata said in its statement.
Tata previously delayed the launch of its Avinya EV from this year to 2026-2027. It remains unclear whether the current developments will result in further postponements.