(Yicai) June 19 -- Jaguar Land Rover signed a letter of intent with Chery Automobile to authorize their joint venture in China to produce electric vehicles under the UK auto giant’s Freelander marque.

Chery Jaguar Land Rover will use Chery Auto’s battery EV platform to develop Freelander-branded electric cars that would be initially sold exclusively in China through a specific network and later exported to overseas markets, Jaguar Land Rover announced today.

Jaguar Land Rover has four brands: Defender, Discovery, Jaguar, and Range Rover. The Freelander marque was discontinued in 2015 and replaced by the Discovery in 2016. The new Freelander will be independent of Chery Auto’s lineup, as well as Jaguar Land Rover’s brands.

Last year, Jaguar Land Rover sold 107,377 vehicles in China, up 25 percent from the previous year, according to the company’s latest annual earnings report. However, most EVs it sold in the country were plug-in hybrids, so it should urgently increase investment to promote its electrification transition.

Jaguar Land Rover has a wide range of products, so it will be expensive and take a long time to successfully transition to electric, a manager at an overseas luxury carmaker told Yicai, adding that working with Chery Auto will help the company lower costs and shorten times.

Chery Auto particularly values the partnership with Jaguar Land Rover, according to a source close to the matter. This would also be the first time the Chinese firm used its platform to develop electric cars for a foreign automaker.

Developing and mass-producing vehicles in Europe with local workers and supply chains makes every unit CNY10,000 to CNY20,000 (USD1,380 to USD2,760) more expensive than in China, a staffer from the planning department of a Shanghai-based automaker told Yicai. Moreover, it would take at least 36 months to develop an EV in Europe, compared with 24 months in China, the person added.

Editor: Futura Costaglione