Jaguar Land Rover to make 'substantial' job cuts after China, diesel slump: Source

LONDON (REUTERS) – Britain’s biggest carmaker Jaguar Land Rover (JLR) is set to announce “substantial” job cuts in the thousands, a source told Reuters, as the company faces double-digit drops in demand in China and a slump in sales for diesel cars in Europe. 

The company builds a higher proportion of its cars in Britain than any other major or medium-sized carmaker and has spent millions of pounds preparing for Brexit, in case there are tariffs or customs checks. 

JLR swung to a loss of £354 million (S$611 million) between April and September and had already in 2018 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. 

The Tata Motors-owned company has unveiled plans to cut costs and improve cash flows by £2.5 billion including “reducing employment costs and employment levels”. Those cuts will be “substantial” and run into the thousands, the source told Reuters. 

“The announcement on job losses will be substantial, affecting managerial, research, sales, design,” said the source, who spoke on condition of anonymity. 

Production line staff will not be affected “at this stage”, said the source. 

The company declined to comment when contacted by Reuters. 

JLR, which became Britain’s biggest carmaker in 2016, had been on course to build around one million vehicles by the turn of the decade, but output in 2018 looks set to have fallen as sales in the first eleven months dropped 4.4 per cent. 

Sales in China between July and September fell by 44 per cent, the biggest slump of any market for the central England-based firm, turning the country from its biggest sales market to its smallest. 

Its chief financial officer said in October that the firm’s Changshu plant in China “has basically been closed for most of October in order to allow the inventory of both our vehicles and dealer inventory to start to reduce”.

Like fellow automakers, the company could be faced with adding costs and bureaucracy on vehicles and components in fewer than 80 days if lawmakers next week reject a deal by Prime Minister Theresa May.

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