BMW, JLR to co-develop electrified vehicles

9th Jun 2019 8:00 am

The two companies have signed a partnership to make electric drive units so that the cost of developing EVs is lower.

Jaguar Land Rover and BMW have announced that they will collaborate on the development of next-generation technology for electric and plug-in hybrid vehicles.

The two firms will jointly develop electric drive systems, otherwise known as EDUs, in a move which Jaguar Land Rover and BMW hope will significantly lower the cost of development in an area of growth that has been incredibly costly for carmakers in recent years.

This new alliance is one of many currently underway in the industry as manufacturers seek to make electrified vehicles more profitable. Most recently, Ford announced a $500m investment in EV start-up Rivian.

No timeframe has been given for when the first fruits of the collaboration will be seen, but it’s likely to be in the next three to four years. Similarly, no volume expectations have been announced but given the need for economies of scale, it is set to be substantial.

Both firms are ramping up their electrified line-ups. Jaguar Land Rover will launch a plug-in hybrid Evoque and Discovery Sport in the next 12 months, while BMW will introduce the electric iX3 next year, closely followed by the i4, an electric equivalent to the 3 Series.

The announcement comes just weeks after Jaguar Land Rover reported a £3.6 billion (Rs 31,654 crore) loss over its financial year, amid persistent rumours of a possible takeover by PSA Group, a deal which has yet to be confirmed.

The collaboration, which includes joint investment in research and development, engineering and procurement, stems from both, the success of Jaguar’s electric I-Pace and BMW’s long-established expertise at having built EDUs in-house since it launched the i3 in 2013. BMW said the firms "share the same strategic vision of environmentally-friendly and future-oriented electric drive technologies.”

Jaguar Land Rover and BMW will work together, at BMW's HQ in Munich, to develop the EDUs, with both developing systems to “deliver the specific characteristics required for their respective range of products,” said JLR's statement.

The EDUs will be made by JLR and BMW at their respective plants. For JLR, this will be the Engine Manufacturing Centre in Wolverhampton, which was confirmed as the home of the firm’s global EDU production earlier this year.

BMW has not yet disclosed where it will build its EDUs, but there have been widespread reports that the company is expanding its manufacturing base in Hams Hall, in the Midlands, which would mean it was in close proximity to JLR’s facility.

The financial terms of the deal will not be disclosed.

Jaguar Land Rover said the move supports “the advancement of electrification technologies, a central part of the automotive industry’s transition to an ACES (Autonomous, Connected, Electric, Shared) future”.

This is not the first meeting between Jaguar Land Rover and BMW. In 1994, BMW bought Land Rover but had limited success so sold it to Ford in 2000. Ford later sold the brand to Tata Motors in 2008.

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