Mumbai: Auto maker Tata Motors Ltd, that owns Jaguar and Land Rover brands, is in talks with the UK government on assistance for the luxury units as sales plummet in their largest markets.
UK business secretary Peter Mandelson has held discussions with Tata Motors chairman Ratan Tata on Jaguar Land Rover, Mandelson told reporters in Mumbai on Friday without elaborating. The UK government is in close contact with Tata Motors, he added.
Help at hand: UK business secretary Peter Mandelson. B Mathur / Reuters
Jaguar Land Rover has eliminated 450 jobs and is in discussions with union leaders about more cost cuts as the global economic and financial crisis damps demand for luxury vehicles. Car makers suspending production in the UK include Volkswagen AG’s Bentley Motors Ltd and Honda Motor Co., while Nissan Motor Co. will eliminate 1,200 jobs in Sunderland, England.
The British government will see how we can help Jaguar Land Rover bring about the financial restructuring it’s seeking, Mandelson said. Tata group is already taking steps that are necessary in this regard, he said.
Tata Motors climbed as much as 5.2% to Rs139.75 after Mandelson’s comments.
UK sales at Jaguar Land Rover fell sharply last month as consumers refrained from big purchases. In December, sales at Land Rover fell 45% to 1,292 units and sales at Jaguar decreased 9.4% to 924 vehicles. In the US, Jaguar sales dropped 34% and Land Rover sales slumped 46%.
Jaguar Land Rover will meet with UK officials next week to discuss increased lending to the British car industry, the unit’s chief executive David Smith said in an interview with Sky News on Thursday.
The Indian truck maker bought the luxury units from Ford Motor Co. last year for $2.4 billion.