FILE PHOTO: A logo is pictured outside a Jaguar Land Rover new car show room in Tonbridge, south east England (Photo by BEN STANSALL/AFP via Getty Images)
Jaguar Land Rover (JLR), owned by India’s Tata Motors, has entered into agreements with lenders in China for an unsecured 3-year term loan facility of £560 million ($704.50 million), marking its first debt financing in China, it said.
The loan is expected to be drawn from the week starting June 8.
Arthur Yu, JLR’s vice president and China chief financial officer, said the Chinese banks that would provide it with the three-year revolving loan include Bank of China, ICBC, China Construction Bank , Bank of Communications and Shanghai Pudong Development Bank.
The fundraising comes as the coronavirus pandemic has hit global automakers’ supply chains and sales. Sales from China used to account for 25 per cent to 30 per cent of JLR’s global sales, but over the past two months make up 50 per cent, Yu said.
The loan facility “can help JLR China better manage cash flow amid the coronavirus epidemic”, Yu said.
JLR, which imports cars and also has a manufacturing partnership in the Chinese eastern city of Changshu with Wuhu-based Chery Automobile, said its China sales in April were level with same period last year, and it saw sales growth in May.
Yu said the company expects sales of China’s luxury car segment this year to be level with last year or see slight growth.