As well as the Chinese slump, JLR – and to some extent, the broader car market – has been affected by a number of other factors including Brexit, US trade tariffs, negativity around diesel and new WLTP regulations.
The job cuts form part of what JLR calls a “turnaround and transformation programme” which is set to improve cashflow and costs to save £2.5bn over 18 months.
JLR cut 1000 jobs at its Solihull plant – which it also shut down for two weeks in October last year due to reduced demand. In December, its Castle Bromwich site, which produces models including the XE and XF, operated on a three-day week.
No factory closures and electric investment
Despite the job losses, JLR has made no mention of any plans for immediate factory closures. Speth said he "refuses to comment" on such matters, saying "we have to wait for politics - what will happen after 29th March?" in another reference to the potential effect of a hard Brexit on production efficiency.
It did, however, confirm further UK investment in electrification with electric drive units to be made at its Wolverhampton powertrain plant from 2020. It said the move will help safeguard jobs at the plant as buyers move away from internal combustion engines.
There will also be a new battery assembly centre at Hams Hall, described as one of the largest of its kind in the UK, using new production techniques and technologies to produce battery packs and modules for future Jaguar and Land Rover models.
The focus on the production of electrified powertrains reinforces the firm’s announcement in 2017 that every JLR vehicle launched from 2020 will have an electrified variant. It already offers plug-in hybrid Range Rover and Range Rover Sport models, as well as the well-received electric Jaguar I-Pace.
New models on the cards
There was also no mention of any plans to scrap any of JLR's 13 model lines in the announcement. Autocar sources also suggest that the firm is continuing to evaluate entering new segments where premium growth is likely.
This year, the second-generation Range Rover Evoque will go on sale and the highly anticipated new Land Rover Defender will be revealed. Further down the line, an electric Jaguar XJ is expected as is a J-Pace, a large SUV to sit at the top of Jaguar’s growing SUV range.
Most growth is expected through its SUVs, which tallies with the broader market trends, while the biggest question mark is over Jaguar’s saloon range which has struggled against German rivals.
Jaguar Land Rover sales fell 4.6% last year to 592,708 units. UK sales were down a modest 1.5% to 115,691, while China was worst hit. Sales there fell 21.6% from 146,399 units to 114,826 units. That means both Europe and North America now lead sales for JLR, putting China in third place. By comparison, in 2017, Chinese sales topped JLR’s chart.
The company said it remains fully committed to the Chinese market and added it has long-term confidence in the Chinese market. The recent fall is being blamed on ongoing uncertainty on import duty charges and trade tensions.
Jaguar Land Rover to electrify every model from 2020