Britain's biggest carmaker Jaguar Land Rover (JLR) is set to cut thousands of jobs as the company faces lower demand in China and a slump in sales of diesel cars in Europe, Reuters reports.
The central English firm builds a higher proportion of its cars in Britain than any other major or medium-sized carmaker. It has also spent millions of pounds preparing for Brexit, in case tariffs or customs checks affect parts supply and exports.
JLR lost £354 million ($450 million) between April and September 2018 and had already cut around 1,000 roles in Britain, shut its Solihull plant for two weeks and announced a three-day week at its Castle Bromwich site.
The Tata Motors-owned company, which employs around 40,000 people in Britain and has boosted its workforce at new plants in China and Slovakia in recent years, unveiled plans to cut costs and improve cash flows by £2.5 billion in 2018, including "reducing employment costs and employment levels."
Speaking to Reuters on condition of anonymity, a source said the cuts will be "substantial" and run into the thousands, "affecting managerial, research, sales, design." The source said production-line staff would not be affected "at this stage."
JLR, which became Britain's biggest carmaker in 2016, had been on course to build around 1 million vehicles by the turn of the decade, on Thursday reported a 4.6% drop in full-year sales to just under 600,000 vehicles.
Demand in China, which had once been one of its strongest countries but has since been hit by an economic downturn, fell by 21.6%, the biggest drop of any of its markets.
"The economic slowdown in China along with ongoing trade tensions is continuing to influence consumer confidence," said Jaguar Land Rover Chief Commercial Officer Felix Brautigam.
Elsewhere in the industry, Ford said on Thursday it intends to cut thousands of jobs in Europe, exit unprofitable markets and discontinue loss-making vehicle lines as part of a turnaround effort aimed at improving profit margins in the region. BMW-owned car brand Rolls-Royce is also taking steps to prepare for a no-deal Brexit but has called on the government to prevent that outcome.