Jaguar Land Rover will slash thousands of jobs next year as the company introduces a $3.15 billion cost savings plan, The Financial Times reports.
The British company has been hurt in recent months by sliding sales in China, falling demand for diesel vehicles and various costs associated with Brexit. These factors prompted Jaguar Land Rover to announce a $3.15 billion turnaround plan that includes £1 billion ($1.26 billion) in cost reductions over the coming 18 months.
Although the company hasn’t announced precisely how many jobs it will cut, people close to the company expect the job losses to run up to 5000. These cuts will follow the 1000 slashed recently at its Solihull plant in the UK.
“It’s do or die at the moment,” Robin Zhu, analyst from Bernstein in Hong Kong said.
“JLR has been seriously mismanaged in recent years, with cost runaways, products disappointing in the market, and hedging issues costing it billions.
“Meanwhile there’s arguably been a lack of accountability in the management ranks.”
Tata has drawn up two plans to help the company. The first, Project Charge, is a three-year plan focuses on cost savings within the first 18 months. The second plan, the longer-term Project Accelerate, is expected to reduce Jaguar Land Rover’s range of models.
“As announced when we published our second-quarter results, these programmes aim to deliver £2.5bn of cost, cash and profit improvements over the next two years. Jaguar Land Rover does not comment on rumours concerning any part of these plans,” the British marque said of Project Charge and Project Accelerate.