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Chinese carmaker Chery is to open a research and development headquarters in Liverpool, in a move that could pave the way for a deal for the British manufacturer Jaguar Land Rover to build its cars.
State-owned Chery’s commercial vehicle arm will base the headquarters for its European operations on Merseyside, including research, engineering, and commercial functions.
Chery has already made a mark in the UK car market through its Omoda and Jaecoo brands, and it is launching its eponymous brand with an advertising campaign featuring former England footballer Peter Crouch.
The UK government has been working on a plan for Jaguar Land Rover (JLR), the country’s biggest automotive manufacturing employer, to build Chery electric vehicles in Britain. The deal was expected to form part of talks during Keir Starmer’s visit to Beijing, although no deal has been announced.
In June, Chery UK director, Victor Zhang, said the carmaker was “actively considering” building a plant in the UK as part of a “localisation” strategy. In a statement, Gong Yueqiong, the general manager of Chery Commercial Vehicle, said: “We are not just bringing products to the UK – we are building a British business.”
The business secretary, Peter Kyle, has discussed the potential deal with JLR’s new chief executive, PB Balaji, according to a person with knowledge of talks. Balaji, formerly an executive in JLR’s Indian owner, Tata Motors, is thought to have said JLR would be open to the move, if it were to benefit the business, although the person added that they did not believe anything concrete had been agreed.
David Bailey, a professor of business economics at the University of Birmingham, said any deal would probably involve using spare capacity at JLR’s factory in Halewood, also on Merseyside. He said the Chery headquarters announcement was “very good news”, but cautioned that he also believed that no manufacturing deal had been finalised.
“They’ve talked about localisation,” he said. “Potentially there’s scope to use the JLR spare capacity.”
The Halewood factory produces smaller Land Rover variants, the Discovery Sport and the Range Rover Evoque. The factory in 2017 produced more than 200,000 vehicles, but it only produced a small fraction of that in 2025. JLR production ground to a halt in the final quarter of last year after a cyber-attack stopped all operations for weeks.
Liam Robinson, the leader of Liverpool city council, said: “Chery Commercial Vehicle’s choice of Liverpool for its commercial vehicle European base is a major vote of confidence in our city’s capabilities, our workforce and our long-term vision for clean, inclusive growth.”
Ford also makes transmissions and electric drive units for vans next door to JLR, while Stellantis, the owner of brands including Vauxhall, Fiat and Peugeot, makes vans in Ellesmere Port across the River Mersey.
Gong said: “Our ‘In UK, For UK, Be UK’ strategy reflects our belief that true globalisation comes from deep localisation. By recruiting local talent, collaborating with UK institutions, and adapting to local needs, we aim to become a valued contributor to the UK’s automotive industry and economy.
“Our strategy reflects our confidence in the UK’s talent, infrastructure, and commitment to green technology.”
JLR declined to comment.
