This article is more than 1 year old

This article is more than 1 year old

Jaguar Land Rover is teaming up with BMW in a partnership designed to lower costs and try to get ahead in the race to produce electric cars for the mass market.

The UK’s largest car manufacturer and Germany’s BMW said they would work together to develop electric motors, transmissions and power electronics in the latest industry alliance formed to address the challenges posed by electric and driverless cars.

The two companies would jointly invest in research and development, engineering and procurement to support volume production of electric cars, allowing consumers to shift away from petrol and diesel cars.

Nick Rogers, JLR’s engineering director, said the partnership would be mutually beneficial at a time when the car industry was facing “the greatest technological shift in a generation”.

He added: “The pace of change and consumer interest in electrified vehicles is gathering real momentum and it’s essential we work across industry to advance the technologies required to deliver this exciting future.

“We’ve proven we can build world beating electric cars but now we need to scale the technology to support the next generation of Jaguar and Land Rover products.”

Jaguar Land Rover is cutting 4,500 jobs from its global workforce as part of £2.5bn cost-saving programme amid falling sales in China and Europe and record losses of £3.4bn in the last three months of 2018. BMW, meanwhile, is trying to cut costs by €12bn and has warned that profits will fall this year.

The huge costs to carmakers of developing electric vehicles come at a time when regulators are tightening the rules on emissions.

Last month Fiat Chrysler and Renault announced plans for a €33bn merger in a move that would create the world’s third-largest carmaker, saving the companies the billions needed to fund the race to make electric and autonomous vehicles.

BMW was one of the first major carmakers to launch a fully electric car, with the i3 hitting the market in 2013. JLR also has an electric car, the Jaguar i-Pace, and both companies have a range of plug-in hybrid models.

Klaus Froehlich, a BMW board member, said: “Together, we have the opportunity to cater more effectively for customer needs by shortening development time and bringing vehicles and state-of-the-art technologies more rapidly to market.”

Engineers from JLR and BMW will work together to design the components, which will then be made at their manufacturing sites. For JLR, this will be at its engine plant in Wolverhampton, which employs 1,600 people.