London: Drop in sales figure has forced the Tata-owned Jaguar Land Rover to cut production of the utility vehicle and redeploy about 300 workers, the British media reported today.
“Two shifts have been lost at Solihull, the main Land Rover production centre, and three will be cut next month at the Halewood factory on Merseyside, where the Jaguar X-Type is assembled,” a report in The Sunday Telegraph said.
JLR has also transferred about 300 staff from Solihull to the Jaguar production line at Castle Broomwich because there is no work for them, the report added.
Due to weakening demand, JLR is reviewing Land Rover production on a monthly basis. Land Rover sales so far have shown only a three per cent fall from 226,000 vehicles last year, but as overall demand dips by 30% in the sectors in which it competes, JLR is being cautious, it added.
Land Rover sales slumped by 31% in the US market in the year to July but strong demand in Russian and Chinese economies almost offset the sharp fall.
Uncertainties about the outlook at Land Rover will slow the recovery in JLR profits. Last year Land Rover accounted for all of JLR’s $650 million profits and almost all of the first quarter’s $421 million.
“Jaguar has struggled, but is enjoying a new lease of life and moving into the black,” the report said, adding that “Tata must also decide on whether to replace Ford, possibly with Italy’s Fiat, as JLR’s engine supplier.”
Meanwhile, the report noted “Tata was forced to ditch the rights issue planned to help finance the 1.15 billion pound paid to Ford for JLR due to share price weakness. Tata will look at asset sales as an alternative.”