Ford Europe, Jaguar to slash thousands of jobs amid turnaround efforts

Evarado Alatorre
Enero 10, 2019

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.

JLR is particularly exposed to the first two of these factors.

Beyond the £2.5 billion now being sought, rumours abound that Jaguar could be reincarnated as an all-electric brand in the not-too-distant future, better positioning it to deliver on future customer demand and lessening the burden it now places on the far-healthier Land Rover. That move will cost 1,200 jobs.

Sales at the SUV-heavy unit, more than double the size of the sports-car business, declined by 6.9 per cent past year. Executives have expressed fears that a no-deal Brexit could cost it as much as £1.2 billion, while Donald Trump's long-mooted tariffs on European auto imports could set it back a further £1 billion, JLR having sold a record 114,000 cars in the USA previous year.

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.

"The economic slowdown in China along with ongoing trade tensions is continuing to influence consumer confidence", said Jaguar Land Rover Chief Commercial Officer Felix Brautigam. It also has a base in Halewood on Merseyside. "This is in addition to the 1,500 who left the company during 2018", Tata Motors said in a filing to the Bombay Stock Exchange.

The firm cut 1,000 temporary contract workers at its plant in Solihull in 2017. It has also shifted to a three-day week at Castle Bromwich, which builds the Jaguar XE and XF sedans.

Meanwhile, Jaguar has been increasing headcount elsewhere in the world.

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It has hired 4,000 workers in China since 2014.

"With record levels of new investment and models set to come on stream in its United Kingdom factories we look for Jaguar Land Rover to continue to be a global success and the jewel in Britain's manufacturing crown". But it's also spent millions of pounds trying to prepare for Brexit, which could have a disastrous effect on its European sales.

Previous year it was rumoured that as part of a £2.5 billion savings plan for the company thousands of jobs would be axed, but now it has been confirmed.

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.

Governor of the Bank of England Mark Carney said the probability of a no-deal Brexit is "uncomfortably high".

But the company has been saying for more than a year that Brexit uncertainty would eventually take its toll on the perception of the United Kingdom as a stable and competitive base for global manufacturing.

The company further said that the next phase of this transformation programme will begin with a voluntary redundancy programme in the United Kingdom, with a view to create a leaner, more resilient organisation with a flatter management structure.

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