JLR books £530m of job-cut costs in a £451m quarterly loss, with 3,000 of 4,000 exits confirmed
Jaguar Land Rover booked £530m of restructuring costs for 4,000 job cuts in July to September, with 3,000 leavers confirmed and most due out by the end of November.
Jaguar Land Rover reported a £451m loss for July to September after booking £530m of costs for cutting 4,000 jobs, 3,000 of which are now confirmed.
Revenue rose to £5.9bn, and JLR’s results statement puts it at £5,894m for the quarter.
Profit before tax and exceptional items was £6m, so the restructuring charge accounts for the swing to a loss.
JLR said free cash flow was negative £540m in the quarter, and the adjusted EBIT margin (operating profit as a share of revenue) was 1.1%.
For the first half of the financial year, JLR reported revenue of £11,867m, profit before tax and exceptional items of £115m and free cash flow of negative £1,538m. Wholesales were 161,775 units, of which 82,487 came in the second quarter.
JLR said it expects the vast majority of the cuts to come through voluntary redundancies, the Guardian reported, with 3,000 already confirmed. Most of those people leave at the end of November.
That leaves 1,000 of the 4,000 posts still to be confirmed. The £530m was recorded for cuts announced near the end of the quarter.
Sales were uneven by region. JLR said wholesale volumes grew quarter on quarter in the UK and overseas markets, offsetting reductions in China and the Middle East.
Volumes also improved significantly on the year before, which JLR said reflected recovery from last year’s cyber incident.
Many European carmakers are struggling as they face Chinese competition while investing in electric production.
At JLR, electric Land Rovers have started with the Range Rover, built in Solihull in the West Midlands. Electric versions of the Range Rover Sport, Defender and Defender Sport will follow.
JLR also builds the electric Jaguar Type 01, and PB Balaji, JLR’s chief executive, said the company was working on a new version of the Discovery. JLR’s statement refers to the proposed arrival of the Range Rover GT and a new electric Defender in the new year.
Balaji said on Friday that the “onslaught of competition” from China meant the UK and EU should stop plans for new post-Brexit trade barriers on each other.
Industry is lobbying for a delay to “rules of origin” due on 1 January, which threaten 10% tariffs on UK-EU electric cars that use batteries from Asia. The EU is also considering “made in Europe” rules that would lock UK-made cars out of subsidies.
“Now is the time for actually fostering this entire electrical ecosystem,” Balaji said. “We just need time to ensure all these plans start coming into fruition.”
JLR is targeting growth in the US, where it is in the process of agreeing a deal for Stellantis to build Land Rovers for the first time. It aims to cut its breakeven volume, the sales needed to cover costs, to 300,000 units through its Enterprise Missions programme.
More on Industry & Makers
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- Schaeffler plans 3,460 European job cuts, 2,660 in Germany, to save about €300m a year from 2030
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