Jaguar Land Rover plans to cut 4,000 jobs to tackle costs

[LONDON] Jaguar Land Rover Automotive will slash some 4,000 jobs as Britain’s largest carmaker grapples with US tariffs, the fallout of a crippling cyberattack and intense competition.

The maker of Range Rover sport utility vehicles will make the cuts, roughly 10 per cent of its global workforce, over the next two years as part of a plan to save £1.7 billion (US$2.3 billion), chief executive officer P B Balaji said on Monday (Sep 7). JLR doesn’t expect the cuts to affect factory workers with reductions voluntary where possible, it said.

“The automotive industry faces significant challenges, with technological change amidst intense competition and ongoing geo-political uncertainty,” Balaji said.

JLR’s cuts add to those by rivals in other countries, such as BMW, Renault and Volkswagen, with the Audi owner last week securing backing for a plan to eliminate 50,000 additional jobs. Europe’s car industry is adjusting to a smaller pool of car buyers as well as stiff competition from Chinese manufacturers like BYD. 

The company, owned by India’s Tata Motors Passenger Vehicles, has also been grappling with higher tariffs in the US, its largest market, a slump in China and the fallout from a cyberattack that shut down its factories for weeks. More recently, a fire at a key supplier and disruption caused by the Middle East conflict have dented sales.

The redundancies are a blow to new UK Prime Minister Andy Burnham who is seeking to reboot British industry, especially in parts of the country where JLR has factories, such as the Northwest of England and the West Midlands. The news also dealt a setback to new Chancellor of the Exchequer John Healey, who on Monday outlined his plan to revive the country’s economy at a manufacturing site in Coventry, close to JLR’s headquarters.

Under Balaji, at the helm since November, JLR is focusing more on the US, where it’s struck a deal with Jeep maker Stellantis to jointly develop cars there, which may pave the way for it to eventually gain access to US factories. It’s also planning more hybrid versions of the luxury Range Rover and Defender models without a plug to target US consumers.

Elsewhere, it unveiled the first electric Range Rover last week and is rebooting the Jaguar brand with a fully electric lineup. Those models are arriving at a time of surging EV sales in Europe.

European carmakers have struggled to keep market share in their backyard with Chinese manufacturers making inroads with more affordable models. Chery Automobile’s Jaecoo 7 SUV has become one of the UK’s most popular models, earning itself the nickname the “Temu Range Rover,” for being a cheaper version of the British brand.

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JLR employs about 33,000 people in the UK, and roughly 40,000 globally. Its revenue fell nearly 10 per cent in the most recent quarter, with pretax profit dropping 69 per cent to £109 million.

In India, the wider Tata Group faces uncertainty over its capital spending plans after chairman Natarajan Chandrasekaran announced he’s stepping down. The conglomerate is pursuing expensive strategic bets including a multibillion-dollar semiconductor push. BLOOMBERG