Press Report : David Smith steps down as JLR’s CEO

John Reed, Financial Times, 25th January, 2010

Jaguar Land Rover said that David Smith was stepping down as Chief Executive Officer and that Tata Motors, its Indian owner, would assist in the handover while it searched for a new head.

The UK luxury marque said nothing about a possible replacement for Mr Smith, except that the group planned to make an announcement “in due course”. Mr Smith took the job in 2008 after the death of Geoff Polites, his predecessor.

During Mr Smith’s tenure, sales of Jaguar’s sports cars and Land Rover’s 4x4s slumped due to the spike in petrol prices and the global financial crisis, which hit large and expensive vehicles the hardest.

Last year, Jaguar sold 51,855 vehicles – 21 per cent fewer than in 2008 – and Land Rover’s 2009 sales were 144,400, 23 per cent lower. JLR announced Mr Smith’s departure in an e-mail to staff on Monday.

Ravi Kant, Tata Motors’ Chief Executive and a Director of JLR, would “assist with the handover of David’s duties and assume day-to-day responsibilities of the Chief Executive until David’s permanent successor is announced”, the company said.

Tata has pumped at least £1.2bn ($1.9bn) into JLR to cover losses at the two brands since buying them from Ford Motor for $2.3bn in early 2008.

JLR would not comment on the reasons for Mr Smith’s departure on Monday, nor its plans to search for a successor. Carl-Peter Forster, who stepped down as head of GM’s European operations last year after the Detroit carmaker’s botched attempt to sell Opel to a Russian-Canadian consortium, has been tipped as a possible successor.

Mr Smith led long-running talks by JLR and Tata with the British Government on loan guarantees that began in 2008, and which were abandoned in October after Tata succeeded in raising financing for the UK carmaker from the State Bank of India and other sources.

The company, which employs about 14,500 people and runs three UK production plants, has cut its staff by about 2,500 since the beginning of the crisis.

Last year it said that it would close one of its two plants in the West Midlands – Jaguar’s in Castle Bromwich or Land Rover’s in Sollihull, both near Birmingham. The company is due to announce which will close by the middle of 2010, but it will not shut the plant until the middle of this decade because it is still building vehicles at both sites.

Reporting its third-quarter results, Tata said JLR earned an operating profit of £41m in the third quarter of last year, an improvement of £75m on the previous quarter.

JLR would not comment on the reasons for Mr Smith’s departure on Monday, nor its plans to search for a successor. Carl-Peter Forster, who stepped down as head of GM’s European operations last year after the Detroit carmaker’s botched attempt to sell Opel to a Russian-Canadian consortium, has been tipped as a possible successor.

[Source: Financial Times]

Clive Goldthorp

Clive Goldthorp

Clive claims that his interest in the BMC>MG story dates back to his childhood in the 1960s when the family’s garage premises were leased to a tenant with an Austin agency. However, back in the 1920s and 1930s, his grandmother was one of the country’s first female Garage Proprietors so cars probably run in his genes! Admits to affairs with Alfa Romeos, but has more recently owned an 06/06 MG TF 135 and then a 15/64 MG3 Style… Clive, who was AROnline’s News Editor for nearly four years, stood down from that role in order to devote more time to various Motor Racing projects but still contributes articles on as regular basis as his other commitments permit.
Clive Goldthorp
Clive Goldthorp

About the Author:

Clive claims that his interest in the BMC>MG story dates back to his childhood in the 1960s when the family’s garage premises were leased to a tenant with an Austin agency. However, back in the 1920s and 1930s, his grandmother was one of the country’s first female Garage Proprietors so cars probably run in his genes! Admits to affairs with Alfa Romeos, but has more recently owned an 06/06 MG TF 135 and then a 15/64 MG3 Style… Clive, who was AROnline’s News Editor for nearly four years, stood down from that role in order to devote more time to various Motor Racing projects but still contributes articles on as regular basis as his other commitments permit.

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