Jaguar Land Rover Is Cutting 5,000 Jobs

Jaguar Land Rover Is Cutting 5,000 Jobs

Jaguar Land Rover is planning to slash 5,000 jobs as a part of a cost-cutting exercise, according to unconfirmed reports. If true, it would mean losing 12.5% of its current workforce total of 40,000 staff. The announcement follows talk of a “perfect storm” within the automotive industry. 

Perfect Storm

The ‘storm’ consists of a drastic decline in diesel car sales, uncertainty concerning Brexit negotiations and reduced sales in the Chinese market. Jaguar is particularly hard hit by diesel and China woes. Over recent years the company has experienced rapid and sustained growth from around £5 billion in 2010 to £25 billion in 2018. It’s this growth that saw its workforce nearly double in less than a decade. At this stage, it’s expected that it’ll be those in managerial, administrative and marketing roles who’ll be the worst hit.

China

As it stands, China is JLR’s largest and most profitable market. Over recent months, its sales in country have dropped by a staggering 50% as Chinese consumers lose confidence following trade tensions with the United States. In addition, the company’s Chinese sales network has been demanding better promotional incentives and superior terms. Extensive criticism of diesel is also taking its toll, as 90% of JLR’s lineup uses a diesel powertrain. Whilst it’s investing in electric and hybrid models, they still make up just a slither of their range.

Precedents

This isn’t the first time the company has made high profile redundancies. In 2018 1,000 workers lost their jobs at the Solihull plant whilst 1,000 workers were put on a three-day week in Castle Bromwich. Despite this, jobs have been created elsewhere around the world; including 4,000 in China. Jaguar Land Rover has also revealed plans to shift production of the Discovery to Slovakia where it expects to create 3,000 employment opportunities.

The luxury manufacturer has been vocal about its concerns concerning a ‘hard’ Brexit. Local unions are focusing on whether the company is investing elsewhere in the world at the expense of British holdings. Either way, it won’t be a happy start to the year for thousands of its employees.

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