John Cranage, Business Editor, Birmingham Post, 16th December, 2008
Jaguar’s Castle Bromwich factory will cease production for three weeks over Christmas and new year as the crisis engulfing the global automotive industry intensifies. The news came amid continuing uncertainty over a possible government bail-out of UK carmakers.
Components manufacturer Stadco said it was cutting more than 100 jobs and there was speculation Toyota was scaling down its estimate of 2009 sales by two million vehicles. Jaguar workers, who finish for their holiday this Friday, will not make any cars until January 12. The prolonged standstill mirrors the festive shutdown at stablemate Land Rover, with Lode Lane closing for Christmas at the end of December 23 until January 12, an extra week. Washwood Heath vanmaker LDV will not resume production until January 20 after a five-week lay-off.
Manufacturing at Solihull and Castle Bromwich is being curtailed as the Tata-owned Jaguar Land Rover battles to avoid stockpiling vehicles, with the sector facing its worst sales for decades. Workers on Jaguar’s XJ and XK lines have been on a four-day production week for two months, with Fridays dedicated to training and maintenance.
Jaguar spokesman Don Hume said: “The plant at Castle Bromwich will close for two weeks from December 19 and then the week starting January 5 will be a non-production week. Workers will not be off – there is a considerable demand for training of one sort or another and they will be catching up with training programmes.” Mr Hume said management would review the four-day production week for the XJ and XK lines in the new year. “Everything will be reviewed once we get into the New Year,” he said
Production of the XJ and XK has been reduced by around 400 cars so far as Jaguar fights to align supply with demand amid the dramatic consumer spending slowdown which has hit showrooms across the UK automotive sector. Land Rover saw sales plunge by nearly two-thirds in November, while Jaguar sales, buoyed by the success of the XF model, fell marginally year on year.
The plant at Castle Bromwich will close for two weeks from December 19 and then the week starting 5 January will be a non-production week. Workers will not be off – there is a considerable demand for training of one sort or another and they will be catching up with training programmes
Around 600 voluntary job losses are being sought by JLR across two separate redundancy programmes, 850 agency staff are being shed in the run-up to Christmas, night shifts have been cut at Lode Lane and 300 workers are taking sabbaticals of up to three months in exchange for temporary 20 per cent pay cuts.
Stadco, which produces panels and pressings for companies including Jaguar and Land Rover, started a consultation process at its factory in Llanfyllin, Powys, yesterday. A total of 106 of the 153 jobs at the mid Wales site are at risk. A company spokesman said the economic downturn and a “major reduction in customer requirements” were behind the decision. He said: “The automotive industry has had quite a challenging year. As a result, Stadco is reviewing its manufacturing capacity.”
Discussions will now be held with staff and union officials, but there will be no compulsory redundancies before the end of March 2009. Stadco, whose customers also include Ford, Aston Martin and BMW, has other factories in Birmingham, Coventry, Germany and Shrewsbury. Workers at its Shrewsbury plant have recently had their hours cut to two and three-day weeks. Full production is due to resume there next month.
Also yesterday, it was reported in Japan that Toyota will slash its global sales target for 2009 to about eight million vehicles. The company, which has an assembly plant at Burnaston, near Derby, and an engine plant at Deeside, North Wales, has been hit by nosediving demand amid the deepening global downturn, reports said. The latest sales projection is down nearly 18 per cent from Toyota’s previous forecast of 9.7 million vehicles.
Japan’s top carmaker expects a prolonged slump in demand in the US and Europe in 2009, with sales already flat in Japan, said the Nikkei, Japan’s top business daily, citing no sources. A Toyota spokeswoman did not confirm the report. The Mainichi daily newspaper said Toyota would announce the sales target for 2009 later this month. Toyota’s sales in the US dropped 34 per cent in November and the company said yesterday it would further reduce production at several factories in North America.
Gordon Brown said yesterday that the government stood ready to help Britain’s manufacturers, when he was asked about the automotive industry in the House of Commons. He was responding to questioning from Birmingham MP Richard Burden (Lab Northfield), who highlighted the strategic national importance of the automotive sector and asked about EU plans to help it through the credit crunch.
Mr Brown said Britain would not ask the EU’s permission before providing aid, saying: “What decisions are taken on the automtive industry are a matter for individual countries. I think this question begs a more fundamental question about whether we are prepared to help, in times of great difficulty, families and businesses. We are prepared to do so – the party opposite is not.”
[Source: Birmingham Post]
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