Jaguar Land Rover to cut workforce by 4500

PA Wire  PA Images

PA Wire PA Images

Most will be in office roles as the company wants to simplify its management structure.

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

Tata Motors-owned Jaguar Land Rover (JLR) is all set to announce job cuts in the thousands amid a crippling China demand slowdown. Autocar sources also suggest that the firm is continuing to evaluate entering new segments where premium growth is likely.

In the darkest day for the British automotive industry since the collapse of Rover 13 years ago with the loss of 6,000 jobs at Longbridge in Birmingham, Jaguar Land Rover said it is having to take "decisive action" to secure the long-term future of the company. It said the move will help safeguard jobs at the plant as buyers move away from internal combustion engines.

It did, however, confirm further United Kingdom investment in electrification with electric drive units to be made at its Wolverhampton powertrain plant from 2020. The 4,500 job cuts are in addition to 1,500 people who left the automaker in 2018, JLR said. Will you be affected by the job cuts?

The company has sounded some of the most urgent warnings among United Kingdom manufacturers about the damage that Brexit uncertainty was doing to investment in the UK.

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 £2.5 billion.

JLR has warned of further losses in the event of the United Kingdom leaving the European Union with a poor trade deal or no deal. Sales in China tumbled 21.6pc.

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JLR's sales have also been hurt by consumer confusion and a shift away from diesel-powered cars in Europe following the VW emission cheating scandal.

The layoffs come amid what industry insiders have called a "perfect storm".

They mean a downturn in Chinese sales, a slump in diesel sales and concerns about United Kingdom competitiveness post-Brexit.

China is the company's biggest and profitable market, but sales have plummeted almost 50% there. But sales in China have fallen almost 50% in recent months as cautious Chinese consumers have been holding back on big ticket purchases amid global trade tensions.

The relationship between JLR and its Chinese sales network have also been strained as dealers have demanded better terms and promotional incentives.

Jaguar employs 44,000 workers in the United Kingdom at sites in Halewood on Merseyside and Solihull, Castle Bromwich and Wolverhampton in the West Midlands.

The company's Ryton and Halewood facilities manufacture the Jaguar XE SV Project 8, Range Rover SV Coupé, Land Rover Discovery Sport and Range Rover Evoque models.

As well as its United Kingdom manufacturing centres, JLR also has facilities in Brazil, Austria, Slovakia, India and China.

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