In this file picture, workers set up the booth for British car manufacturer Jaguar Land Rover’s Jaguar brand inside the National Exhibition and Convention Center, the venue for the recently held China International Import Expo (CIIE), in Shanghai, China.
LONDON: Jaguar Land Rover (JLR) will cut 10 percent of its workforce, mostly in its home market, as Britain’s biggest carmaker faces lower Chinese demand and a slump in European diesel sales.
JLR, based in central England, will cut some 4,500 out of 42,500 jobs, targeting managerial roles rather than production-line workers as it battles to return to profitability.
Owned by India’s Tata Motors, JLR also said it will build electric drive units at its Wolverhampton engine plant and create a new battery assembly centre in Hams Hall, near Birmingham, as it develops a greener vehicle range. JLR builds a higher proportion of its cars in Britain than any other major or medium-sized carmaker and has spent millions preparing for Brexit, in case of tariffs or customs checks.
But it lost £354m between April and September 2018 and had already cut around 1,000 roles in Britain, shut its Solihull plant for two weeks and announced a three-day week at its Castle Bromwich site.
JLR’s chief executive Ralf Speth said yesterday he needed to go further as part of the company’s turnaround plan.
“We are taking decisive action to help deliver long-term growth, in the face of multiple geopolitical and regulatory disruptions as well as technology challenges facing the automotive industry,” Speth said.
JLR, which became Britain’s biggest carmaker in 2016, had been on course to build around 1 million vehicles by the turn of the decade, reported a 4.6 percent drop in full-year sales to just under 600,000 vehicles.
It has hired staff in China and Slovakia in recent years as it opens new plants and last year unveiled plans to cut costs and improve cash flows by £2.5bn.
Speth warned in September that the wrong Brexit deal could cost tens of thousands of car jobs and posed a production threat.
Ford also said yesterday it will cut thousands of jobs in Europe, exit unprofitable markets and discontinue loss-making vehicle lines as part of a turnaround effort aimed at improving profit margins in the region.
Demand in China, which had once been one of its strongest countries but has since been hit by a slowdown, fell by 21.6 percent, the biggest drop of any of its markets.Several companies have warned of a slowdown in China and the effect of trade wars just as automakers pump billions into greener technologies to meet stricter emissions rules and customers shun combustion engines in the face of higher levies.
Demand in China, which had once been one of its strongest countries but has since been hit by a slowdown, fell by 21.6 percent, the biggest drop of any of its markets.
“The economic slowdown in China along with ongoing trade tensions is continuing to influence consumer confidence,” said JLR Chief Commercial Officer Felix Brautigam.
Diesel accounts for 90 percent of the firm’s British sales and 45 percent of global demand, the company said last year, as demand in the segment tumbles following new levies in the wake of the 2015 Volkswagen emissions cheating scandal.
