But it's not from the UK.
Jaguar Land Rover's financial troubles have been known for some time and today there's finally some good news to report. According to Reuters, JLR has secured a $705 million loan with lenders from China. This is actually the first time the Tata-owned automaker has received financing in China. A total of four Chinese banks will provide JLR a three-year revolving loan that will allow it to "better manage cash flow amid the coronavirus epidemic."
It's important to remember JLR's financial problems started long before the pandemic hit. In the latter part of 2018, it reported a troubling $113 million loss. JLR quickly began cost-cutting measures such as slashing thousands of jobs and scrapping cool but unnecessary projects, such as the ultra-limited Range Rover SV Coupe.
Thanks to its cost-cutting plan, things finally began to look better, then the pandemic arrived. Not only are these loans needed to keep the doors open and the lights on, but also to continue development with new models, such as the next-generation Jaguar XJ flagship sedan, which is expected to be an all-electric Tesla Model S and Porsche Taycan rival. Land Rover is also moving quickly towards electrification.
The fact that Chinese banks came to JLR's rescue is interesting and also makes a lot of sense. Despite its UK roots, JLR is owned by Indian automaker Tata Motors and China is a big sales market. It already imports vehicles there through a partnership with China's Chery's Automobile.
Fortunately, JLR reported a sales gain in China this past April compared to the same time last year. May sales also appear to have improved. So it appears China is not only the source for better sales than any other market currently, but its financial institutions also provide a much-needed source of funding to keep things on track.
Those lenders must have also taken notice of China's continued high demand for luxury cars, which is expected to be at least the same if not better than 2019's final tally.
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