LONDON (Reuters) - The London Electric Vehicle Company, which makes the city’s famous black taxis, is delaying the arrival of its first van as it now plans to work more closely with Chinese parent company Geely (0175.HK), its boss said.
LEVC was bought out of bankruptcy by the Chinese automaker in 2013, which has since opened a 325-million pound factory in central England and turned the domestic taxi producer into an exporter.
The firm said in September it would be trialling its new electric van this year but Chief Executive Chris Gubbey told Reuters on Tuesday that the firm’s first commercial vehicle would now come to market “in the early 2020s.”
“On our own, we’re a relatively small player and for us to charge ahead and develop our own product and then try to maintain that and put further investment in to build off that, does not make sense,” he said.
Gubbey said the decision has not been influenced by Brexit which is due to take place on March 29.
Geely said on Monday it was forecasting flat sales, a sharp slowdown from 2018 as China’s giant auto market struggles with slowing economic growth and more cautious consumers.
Asked whether the decision regarding LEVC’s first commercial vehicle was linked to economising at Geely, Gubbey said: “That word hasn’t come up in the discussion.”
LEVC built 1,200 taxis at its Ansty factory last year and expects that to slightly more than double this year as the firm sells more of its electric models in both its home market and to countries such as Germany and France.
However, like manufacturers across the country, the firm faces the challenge of a possible no-deal Brexit in just 80 days’ time, which could lead to tariffs, adding to costs, and customs checks, disrupting the flow of parts and vehicles.
The company is talking to its logistics provider regarding the movement of European-sourced components which are predominately delivered via trucks through the port of Dover and will have a buffer of finished vehicles by the end of March.
“In terms of the export sales... we are working with our partners in terms of the potential for taking deliveries early so that they’ve got them there and they built up their own inventory a little bit earlier,” said Gubbey.
Editing by Stephen Addison