Jaguar Land Rover has been forced to slim down its headcount in the wake of falling global car sales. The company won’t be renewing the contracts of 1000 contract workers at Solihull. However, it says that it’s still racing to recruit more engineers and apprentices to develop the next generation of cars.
The company, which is the UK’s largest carmaker, blames a slowdown in the global car market and a rapid move away from diesel products in Europe. More than 90% of JLR’s sales are currently diesel-powered cars and the company’s racing to catch the opposition in plug-in hybrid and electric technology.
The move follows the announcement late in 2017 that it would cut car production due to uncertainties over the post-Brexit trading conditions and changes to taxes on diesel cars. Professor of Industry, David Bailey, from Aston University, told the BBC: ‘With the big turn against diesel engines, Jaguar Land Rover is particularly exposed as more than 90% of its UK sales are diesels. JLR has just revealed its full-electric I-Pace model and have indicated offering all-electric or hybrid variants of all their models by around 2021.’
Continuing sales slide is punishing diesels
The backdrop to this story is that sales in the UK are falling back rapidly. In March 2018, the registrations reported by the Society of Motor Manufacturers and Traders (SMMT), were down by -15.7% compared with 2017. Uncertainty over future anti-emissions regulations, the economy and a fall in consumer confidence are all cited as contributing factors.
Demand from business, fleet and private buyers all fell in March, down -14.3%, -15.0% and -16.5% respectively, with diesel registrations slumping massively – down -37.2%. Registrations of plug-in and hybrid vehicles continue to rise, albeit modestly, up 5.7%, with demand for plug-in hybrids driving growth, up 18.2% for the month.
This fall is the twelfth consecutive month in new car sales. According to the SMMT, nearly 720,000 new high-tech, low-emission cars left forecourts in the first quarter of 2018 as consumers took advantage of competitive offers, meaning last month’s market was still the fourth biggest on record.
What the industry says about the drop in UK car sales
With more than 80% of all new car transactions in the retail sector being on Personal Contract Purchase (PCP), the view of car finance expert Graham Hill is interesting. He says: ‘The Government’s mixed messages around diesel and petrol emissions have completely paralysed customer activity in the new car market. To say that this is mixed signalling from the Government and industry is an understatement.’
Simon Benson of AA Cars adds: ‘It’s hard to ignore the fact that, instead of the usual March spike after the introduction of new plates, this is more of a whimper than a bang. Our own data shows that used car sales continue to beat dwindling consumer confidence and rise.’
Mike Hawes, SMMT Chief Executive, said: ‘March’s decline is not unexpected given the huge surge in registrations in the same month last year. Consumer and business confidence has taken a knock in recent months and a thriving new car market is essential to the overall health of our economy.’
Is the Editor of the Parkers website and price guide, formerly editor of Classic Car Weekly, and launch editor/creator of Modern Classics magazine. Has contributed to various motoring titles including Octane, Practical Classics, Evo, Honest John, CAR magazine, Autocar, Pistonheads, Diesel Car, Practical Performance Car, Performance French Car, Car Mechanics, Jaguar World Monthly, MG Enthusiast, Modern MINI, Practical Classics, Fifth Gear Website, Radio 4, and the the Motoring Independent...
Likes 'conditionally challenged' motors and taking them on unfeasible adventures all across Europe.
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