Jaguar Land Rover and Chery Automobile said on Sunday they had laid the foundation stone for a new car factory in Changshu, China, near Shanghai.
The move had been expected after the partners recently won Chinese regulatory approval for the joint venture to make Jaguar Land Rover (JLR) vehicles and new models for a partnership brand in China.
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The deal marks the latest effort by JLR, which is controlled by India's Tata Motors Ltd, to expand its appeal in the world's largest auto market, where luxury sedans and SUVs remain in hot demand even as the overall car market cools.
It will also help raise the profile of Chery, a mass volume player aspiring to gain access to the lucrative upscale segment dominated by foreign brands.
(Reporting by Ben Hirschler; Editing by David Cowell)