Chery bets on UK localisation with Sunderland assembly and logistics expansion

As demand and sales rise for Chery vehicles in the UK and Europe, including Chery’s Omoda and Jaecoo, its brands that are only marketed outside China, the Chinese OEM is pushing localisation of its supply chain in the UK.

Speaking virtually at Automotive Logistics & Supply Chain UK, Catherine Zhu, logistics director UK at Omoda and Jaecoo, outlined how the fast-growing OEM is evolving its logistics network from a start-up import operation into a mature European supply chain capable of supporting rapid sales growth.

Chery scales logistics to match UK sales growth

Less than three years after entering the UK market, Chinese automaker Chery is moving beyond the challenges of launching a new brand and into the next phase of its growth. Rapid increases in sales are forcing the carmaker to rethink its logistics network, investing in new facilities, localisation and long-term transport partnerships to support what is becoming one of the UK's fastest-growing automotive businesses.

The company delivered more than 53,000 vehicles across its brands in the UK last year and more than 61,000 during the first five months of 2026, giving it close to 5% of the market. According to the most recent figures released by the Society of Motor Manufacturers and Traders (SMMT), Omoda and Jaecoo UK recorded another strong month for car sales in June this year, registering a total of 9,754 vehicles and achieving a 4.6% market share during a strong month for the UK new car market, as registrations rose by more than 11% year-on-year.

"Over the course of more than two decades, Omoda, Jaecoo and Chery has transformed from a local automotive manufacturer into a global technology-driven mobility enterprise with a comprehensive international footprint," Zhu said.

To support that expansion, Chery has established offices in London and Liverpool to manage its passenger car and commercial vehicle operations in the UK, while also investing in internal logistics capabilities designed to improve material flow and make better use of available space within its facilities.

But as Chery expands throughout the UK and beyond, the OEM is also expanding and adjusting its logistics strategy, from local assembly and finished vehicle logistics to aftersales support and long-term partnerships across the supply chain.

Chery’s major investments in UK logistics

One of Chery’s more strategic investments lies in its localisation strategy. As part of its “In UK, For UK, Be UK” approach, is in a new knockdown facility in Sunderland. Speaking about the plans for the first time at ALSC UK, Zhu said: “This is a major step, so we will soon begin producing vehicles here in the UK.”

Following the signing of a memorandum of understanding with Nissan, Chery plans to assemble vehicles at Nissan's Sunderland plant using knock-down (KD) kits shipped from China.

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Rather than investing in an entirely new European factory, Zhu described the arrangement as a faster route to local production.

“This allows us to start production quickly while building the local supply chains,” she said. “Over time, these Sunderland-built vehicles will serve both the UK domestic market and be exported to European countries, giving us locally produced cars on both sides of the channel.”

She added: "Sunderland currently runs at only about 45% capacity. We bring volumes, they bring world-class manufacturing. It's a win-win that accelerates our local production in Europe by years compared to building a new factory."

This new facility could provide a buffer against the risk of stricter trade barriers between China and the UK or Europe. While Brexit complicates things slightly (with new Made in EU proposals and Rules of Origin changes threatening UK supply chains), the facility could help Chery to protect against any additional tariffs on Chinese-made vehicles.

The company is now negotiating production volumes, model allocation and supply chain arrangements as it prepares for local assembly.

Building a resilient finished vehicle network

In recent years, Chery has moved from the simplified exporting of vehicles to establishing a self-operated international system, leveraging 4PL (fourth party logistics with end-to-end strategic management and technology integration of the whole supply chain) and more classic 2PL models. Zhu said this “strengthens the market penetration and operational efficiency” of the brands.

Although Omoda and Jaecoo only entered the UK market in 2024 and 2025 respectively, Zhu said the logistics operations are designed around resilience and scalability. Vehicles are currently produced in China and shipped to the UK via ro-ro vessels, primarily through ports on England's east and south coasts. From there, vehicles are processed through strategically located vehicle processing centres (VPCs) before being delivered to more than 180 retail locations via specialist transport providers. Rather than holding significant vehicle inventory, Chery has adopted a flow-through logistics model.

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“At this scale, the model has to evolve rapidly,” she said. “We’re moving from spot chartering to more long-term contracts and dedicated vessel schedules.” She said that the OEM now has long-term agreements with the top shipping liners, ensuring stable capacity and fixed liner services. “This has dramatically reduced our exposure to freight rate volatility and market fluctuations.”

Chery is in the process of forming a joint venture to establish a dedicated fleet, allowing better visibility while lowering investment risk. In terms of vessels, Zhu said the company has added six new chartered vessels which are due to begin operating at the end of 2026. “More notably, we have secured charter rate vessel on the Arctic route which reaches the UK in just 22 days, whereas normally it takes 45 days, so that is dramatically faster than conventional routes” she added.

The carmaker has also formulated a decongestion strategy for ports. Zhu said that single ports can’t handle a few hundred thousand vehicles annually, so the OEM is spreading the risk through strengthening links with other coastal ports in the UK. “This really aligns directly with our European headquarters’ strategy and the UK strategy, using the inland and railroad networks there to relieve the pressure and optimise the last mile costs,” she said.

Scaling aftersales for long-term growth

Ensuring that the strategy runs end-to-end across the UK automotive supply chain, Chery has built its own service network and repair centres in the heart of the UK.

Chery has also outsourced its UK aftersales logistics to DHL Supply Chain, operating from Rugby, with a focus on future electrification.

The facility includes specialist capabilities for storing and handling high-voltage EV batteries alongside conventional spare parts, allowing the network to support petrol, hybrid and battery-electric vehicles from a single location. As volumes increase, the company is evaluating additional regional warehouse capacity while maintaining Rugby as the primary national distribution hub.

“The logic is, scaling fast, building the capability to support your network as the scale adapts,” she said. “We are not just shipping cars to the UK, we are building a complete industrial and logistics footprint here, and the investments we have prioritised reflect that long-term commitment,” Zhu added.

Looking beyond suppliers to strategic partners

To support the growing scale of Chery’s network in the UK, Zhu stressed the importance of working with local logistics providers that offer more than transportation. Rather than transactional suppliers, the OEM is seeking partners willing to invest alongside the business and grow with its rapidly expanding UK operation.

“We would like to find a supplier that we can grow and expand together with, and we can do investments together with our suppliers and carriers and build the long-term commitment to really drive the success mutually,” Zhu said.

While cost, responsiveness and service performance remain important, Zhu said long-term collaboration will increasingly become the defining factor in supplier selection.

“All the traditional requirements of carriers are also part of that, but I think we will really want to build a long-term strategic partnership with our suppliers in the UK so we can grow and develop together,” she said.