Jaguar-Land Rover to cut 4,500 jobs worldwide


The UK's biggest auto manufacturer Jaguar Land Rover announced on Thursday afternoon it is cutting 4,500 jobs, or about 10% of its workforce, in a bid to save money.

Meanwhile Rolls-Royce Motor Cars chief executive Torsten Muller-Otvos has pledged that the carmaker will remain in Britain post-Brexit.

The British company, which employs 44,000 in the United Kingdom and cut 1,000 temporary contract workers at its plant in Solihull previous year, has been hit by poor sales in China and a drop in demand for diesel cars. That move will cost 1,200 jobs.

The company's move follows plans announced past year to reduce white-collar jobs across the company's global business.

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

JLR, the UK's biggest vehicle maker, says it will be making further investment in electrification, with electric drive units to be produced at Wolverhampton and a new battery assembly centre to be established at Hams Hall, Birmingham.

The job cuts announced Thursday will affect mostly workers in the United Kingdom, including contractors, senior management, supervisors, engineering, and design workers, according to people familiar with the matter who asked not to be named discussing details that weren't announced.

Total auto sales in China (JLR's biggest market) declined for the first time in two decades past year, as the nation's consumers reacted to the economic uncertainty surrounding the introduction of United States trade tariffs.

The firm said the move would help it cut about £2.5bn ($3.2bn) in costs over the next 18 months and prepare the company for a courageous new world of electric and autonomous vehicles.

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Britain's business minister Greg Clark said on Thursday it is clear why a no-deal Brexit would add to the problems with further costs and disruption.

The company said in July a year ago that it needed more certainty around Brexit in order to continue investing in its United Kingdom operation.

Electric cars such as the Jaguar i-Pace (above) aren't cheap to produce, and JLR is grappling with an worldwide footprint to ensure it's building its growing range of vehicles in territories where it makes sense, near customers and where the business case is strongest.

If, as expected, the United Kingdom bears the brunt, or the entirety, of JLR's global cost-cutting, JLR may well say it tried to warn us. However, amid China demand concerns, the company had witnessed a silver lining in the USA sales, with numbers improving almost 24 percent in December.

Production-line staff will not be affected "at this stage", said the source.

In China it has hired 4,000 workers since 2014.

But it lost 354 million pounds ($450 million) 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.

This is what a JLR sales manager in Beijing meant when he told us his UK Headquarters has failed to predict the Chinese market and had underestimated Chinese consumers.