Future growth in driverless vehicles and shared ownership spurs UK’s biggest carmaker
The Carlyle Group has put Addison Lee up for sale and hopes to make more than £300m.
Photograph: Felix Clay/The Guardian
Britain’s biggest carmaker, Jaguar Land Rover, has emerged as a potential contender to buy the private hire firm Addison Lee.
The move would be the latest attempt by a traditional car manufacturer to position itself for a possible future of shared ownership and driverless cars.
Addison Lee has been put up for sale by its owner, American private equity firm the Carlyle Group, which hopes to make more than £300m from the taxi firm.
JLR is one of several prospective bidders, including car manufacturers, technological companies and private equity firms, according to a report in the Sunday Telegraph.
The manufacturer has axed jobs and suffered heavy losses as it struggles to combat a combination of “headwinds”: a backlash against diesel vehicles, significant decline in demand for cars in China as well as Brexit uncertainty.
In February, it posted its biggest quarterly loss of £3.4bn, writing down the value of its investments as Chinese demand slumped. Earlier this month, it shut down its main UK manufacturing sites, employing more than 18,000 people, for a week to prepare for feared no-deal Brexit disruption.
JLR, which is owned by India’s Tata Group, announced this year it would shed about 4,500 jobs, a tenth of its staff, as part of an overhaul to face major shifts in the automotive sector.
It has been regarded as slow to adapt to the evolving market for electric vehicles – a shift driven in part by swingeing EU penalties for manufacturers that fail to curb average fleet emissions – despite the launch of its electric I-Pace cars.
However, it has been part of a consortium giving trials to connected and autonomous cars, along with Addison Lee. The industry anticipates a growth in ride-sharing as electric and driverless cars – much more expensive to produce – replace fossil-fuel fleets, potentially spelling fewer traditional sales to individual car owners.
JLR has partially insulated itself with a contract to supply Waymo, the Google offshoot, with up to 20,000 potentially self-driving I-Paces.
An Addison Lee acquisition could cement a smaller, British equivalent of the tie-ups between car manufacturers and technology firms, in the footsteps of Ford’s partnership with Lyft and Uber’s robotaxi venture with Volvo.
A spokeswoman for JLR said the company would not comment on the story.
Addison Lee has signed a deal with the driverless pioneers Oxbotica to bring some self-driving car services into London by 2021. Its dominance in the London minicab market was upset by Uber but Addison Lee has grown to run almost 5,000 cars in the capital and has extended its services to other major cities. Through its app it claims to provide hire services in 350 cities around the world.