Jaguar Land Rover plans to cut around 4,000 jobs over the next two years, adding to the growing pressure on Europe’s automotive industry.
The planned cuts will amount to about 10% of the British luxury carmaker’s global staff, it said. The majority of JLR’s employees are in the UK, where approximately 34,000 employees work for JLR.
Management positions would be among those impacted, said JLR. The company has announced a voluntary redundancy programme, which is a part of an ongoing programme to rationalise the business and cut expenses.
The news follows a rocky start for the carmaker. JLR has been coping with the financial fallout from a significant cyberattack that caused a halt to production in Britain and US tariffs that have imposed pressures on the business.
The company stated that it will save £1.7 billion (roughly US$2.3 billion) as a result of the restructuring.
Manufacturing auto components was one of the biggest challenges for the automotive industry due to the rapid pace of technological change, intense competition and persistent geopolitical uncertainty, said JLR chief executive PB Balaji.
The company will introduce five new products in the next 12 months and focus more on markets such as North America in its efforts to boost revenues, he said.
The staff cuts come amid industry-wide job cuts worldwide. Last week, Volkswagen announced another 50,000 job cuts that will see the total of the manufacturer’s workforce cut by approximately 100,000 jobs by the end of the decade as part of a restructuring plan.
European carmakers are also seeing greater competition from Chinese manufacturers, and with a big investment in the transition to electric vehicles.
The British production facilities of JLR, owned by Indian firm Tata Motors, were paralyzed for over a month after a cyberattack. The company has calculated the cost of disruption to be £260m.
JLR reported a loss of £244m for the financial year that ended in March, against net profit of £1.8bn in the previous financial year. As part of its greater efforts to go electric, the company has since launched orders for its new all-electric Range Rover.
JLR executives are set to meet with the UK government’s business minister Jonathan Reynolds this week to discuss the job cuts.
Source: AFP
