The cutback in jobs comes at a time when retail sales have picked pace in China, one of the largest markets for JLR
Unite, the UK and Ireland’s largest union, has described the axing of 1,100 agency workers at Jaguar Land Rover (JLR) factories by parent Tata Motors as ‘devastating and painful’.
The workers are employed by the agency Manpower and principally work on the car production line. It is understood that there will be around 400 job losses at the Solihull plant, with the remaining job losses spread over the company’s other sites in the West Midlands and Merseyside, a statement from Unite said.
The job losses are a result of a sharp decline in car sales as a result of the COVID-19 pandemic. Tata Motors has embarked on a massive cost cutting and fund saving drive for FY21 that includes getting rid of some projects that are unlikely to bear fruit any time soon.
During the quarter-ended March, JLR clocked retail sales of 109,900, a 31 percent drop compared to the same quarter last year when it sold 158,900 units. As a result of lower sales, JLR suffered a loss of 501 million pounds in Q4.
Manpower will now seek to find other engagements for the workers, but without success it will be required to make them redundant. It is expected that the workers will leave JLR at the time of the summer shutdown, Unite added.
More than 20,000 Jaguar Land Rover employees were furloughed with each person getting 2,500 pounds directly from the government. In the June quarter, JLR is expecting the monthly amount to be close to 50 million pounds. The total number of employees furloughed has fallen to 13,000.
Unite National Officer Des Quinn said, “This is a painful blow for a loyal workforce. Given the unprecedented drop in demand due to COVID-19 pandemic it was all but inevitable that job losses would be announced. It is another devastating blow for our auto sector and the communities that rely on them for jobs.”
The cutback in jobs comes at a time when retail sales have picked pace in China, one of the largest markets for JLR. May retail sales in China, where all of JLR’s showrooms are open, stood the highest since December and nearly on par with its pre-COVID days. Total retails for JLR in May stood around 24,000 units.
There are signs of recovery in North America, Europe and the UK itself with regard to sales in May. JLR also has orders of more than 22,000 units for the new Land Rover Defender, while sales of new Evoque and Discovery Sport have been ‘encouraging’.Join the Moneycontrol Rule the New Normal powered by Lenovo webinar on the 18th of June. REGISTER NOW!
