London: Luxury car maker JaguarLand Rover (JLR), owned by the Tata group, is reviewing earlier plans to close one of its UK plants on account of a recent revival in sales and is also likely to seek the UK government’s assistance for launching new models, says a report.
UK-based The Sunday Times has reported that JLR was “weighing a dramatic about-face on plans to close one of its three UK production plants”.
Quoting persons familiar with the development, the publication said a recent revival in sales coupled with the arrival of a new management team “has led to a review of the closure plan”.
In September last year, the company had said it planned to close one of its factories.
“Its plant at Halewood on Merseyside was safe, with the axe to fall on one of the Midlands sites, Castle Bromwich or Solihull. An announcement on which was to close was expected this summer,” the report noted.
Tatas have hired Carl-Peter Forster, earlier with General Motors in Europe, and Ralf Speth, formerly a BMW executive, to manage JLR operations.
Quoting persons familiar with the development, the publication said that Forster and Speth were now considering a business plan that would see both marques launch models and increase production.
The plan could require keeping all three plants open.
“JLR is likely to seek government assistance tied to the launch of new models,” it said.
Pointing out that the request could prove tricky, the newspaper said, “Two years ago, Tata asked the government for a £1 billion (Rs6,850) loan guarantee to tide it over a slump in sales caused by the credit crisis.
“Talks dragged on for months until Tata finally announced it had been able to secure the necessary finance from other sources.”
According to the report, the plant closure plan was announced not long after the talks with government broke down and JLR embarked on a cost-cutting drive.
JLR has about 14,000 employees in the UK.
Since the start of 2010, sales at the company have improved. Land Rover sold over 67% more vehicles in the UK last month than in March 2009, while global sales last month rose by 43%, it added.