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Jaguar Land Rover will produce up to 200,000 cars a year exclusively for the Chinese market thanks to a new joint venture between the British car maker and China’s Chery Automobile Company.

A new $1.65 billion manufacturing plant in Changshu, near Shanghai, will support the lucrative arrangement with JLR planning to start production of Chinese-built Land Rover products, as well as China-specific models, from as early as 2014.

As recently as a decade ago, Jaguar and Land Rover barely had any presence in China, selling just a handful of cars each year.

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However, sales rocketed by 80 per cent in China in the first 10 months of 2012, resulting in a total of 75,000 units sold by the end of the year.

The new factory is the first JLR facility to be established outside its UK home base and is expected to generate significant commercial growth for the two iconic British car brands.

While Jaguar bosses are remaining tight-lipped about which models will be produced at the new plant, it is understood the first vehicle off the production line will be a Land Rover product – most likely the Range Rover Evoque.

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The facility will also have the capacity to produce Jaguar models such as the XJ and XF, which have already proved popular as imports for wealthy Chinese buyers.

In addition to producing JLR vehicles under licence, the partnership will also produce models for a new domestic brand tailored specifically to local customers.

Chery is the largest Chinese car exporter and one of the country’s most prolific automotive manufacturers, with 15 years’ experience in the industry.