Tata Motors Ltd. is studying the possibility of building and selling certain models in China, the largest auto market in the world, according to its annual report. India-based Tata Motors, which owns Jaguar and Land Rover, is headed by Chairman Ratan Tata. In this annual report, Tata said that China has turned into an “important market” for the automaker.
Talks are ongoing between Tata Motors and Jaguar Land Rover Plc to begin the development of engines in the United Kingdom and India. Sales in China this year have risen at a slower pace after rising by 32% in 2010.
This is because the government has ended incentives and had applied purchase restrictions to prevent traffic congestion.
In June 2008, Tata Motors acquired Jaguar and the Land Rover sport-utility vehicle brand from Ford Motor Co. Since then, Tata Motors has started to assemble the Land Rover Freelander models in India.
Tata stated that there could be a drop in the demand due to the high inflation in Asia. The car sales of India in June climbed at the slowest rate in the past two years due to increasing interest rates in an economy where 80% of the car purchases are financed through loans.
In June, China's passenger-car sales rose by 6.2%, a big turnaround from the decline in the prior month, according to the China Association of Automobile Manufacturers on July 8.