Jaguar Land Rover set to axe 5,000 jobs over Brexit and diesel fears
British marque has also been hit by sales slump in China
Jaguar Land Rover is reportedly planning to cut around 5,000 jobs in the new year as it seeks to mitigate the impact of Brexit, the decline of diesel cars and slow sales in China. The move would save the company £2.5bn.
Company insiders told the Financial Times that the Tata-owned carmaker would outline the short-term part of its plan in January. It’s understood the job losses will run “into the thousands” with the latest analysis putting the figure at roughly 5,000.
In an interview with the FT, Robin Zhu, an analyst at Bernstein in Hong Kong who covers JLR and Tata, said that it was “do or die” for the British marque.
“JLR has been seriously mismanaged in recent years, with cost runaways, products disappointing in the market and hedging issues costing it billions”, he said. “Meanwhile, there’s arguably been a lack of accountability in the management ranks.”
In response to the report, a JLR spokesman said the company was aware of the media speculation over the impact of its plans but added that the carmaker “does not comment on rumours”.
“As announced when we published our second quarter results, these programmes aim to deliver £2.5bn of cost, cash and profit improvements over the next two years”, the spokesperson said.
The Unite union argues that the continuing levies on diesel owners and the “botched” handling of Brexit negotiations are putting pressure on the 40,000-strong workforce at JLR, The Guardian reports.
The carmaker has also been affected by losses of £90m in the third quarter of this year, says the paper. The company attributes these to falling sales in China.
In April JLR confirmed it would not renew the contracts of 1,000 agency workers at its plant in Solihull, blaming Brexit and diesel confusion, the BBC says.
Last month JLR revealed that it would be cutting 200 positions from the same factory when it moves production over to its new Slovakian plant next year, the broadcaster adds.