BMW, Jaguar Land Rover join forces on electric-car technology

This article first appeared in The Edge Financial Daily, on June 10, 2019.

Jaguar Land Rover’s I-Pace electric vehicle. Photo by Bloomberg

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BMW AG and Jaguar Land Rover plc will collaborate on their next generation of electric cars, following similar moves by other automakers that have teamed up to share the burden of developing the expensive new technology.

Jaguar Land Rover, owned by India’s Tata Motors Ltd, will cooperate on BMW’s fifth generation of electric drive technology, the companies said in a statement last Wednesday. It forms the backbone of a BMW electric model offensive set to start next year with the introduction of an electric X3 sports utility vehicle.

The move follows Fiat Chrysler Automobiles NV’s proposal in the previous week to merge with Renault SA, creating the world’s third-biggest automaker. The deal would bring the Italian-American automaker into a global alliance that includes Nissan Motor Co, maker of the pioneering Leaf, and Mitsubishi Motors Corp.

The world’s largest automaker, Volkswagen AG, and US rival Ford Motor Co are cooperating on building vans, a project that could extend to autonomous cars or sharing production platforms.

The need for record spending on the technology coincides with a time of low profit and stagnating sales. BMW is currently working through a US$14 billion (RM58.24 billion) savings plan, while Jaguar is undergoing a £2.5 billion (RM13.21 billion) savings programme of its own and cutting 4,500 jobs.

The carmakers will form a joint team of experts in Munich that will develop power units together. Both companies will still produce drivetrains in their own factories, they said in the statement.

BMW was an early entrant into the electric-car market with the i3 hatchback, which began production in 2013, though sales have not taken off. Jaguar started deliveries of the all-electric I-Pace last year, one of a crop of premium sport utility vehicles being launched by traditional carmakers to take on Tesla Inc. — Bloomberg