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Axe hovers over Solihull

The UK motor manufacturing industry has been rocked by production cuts at Jaguar and the news that a road map drawn up by Land Rover management and unions had failed to satisfy Ford bosses.

Land Rover was due to hear this week whether its Solihull plant has a manufacturing future.

Jaguar is to cut production by 15,000 units (about 11%), between now and the end of this year.

No job losses have been announced, but the company’s 8,000 or so production workers are to go on short-time working – a four-day week at Coventry (XJ and XK) and Halewood (X-type), and three days at Castle Bromwich (S-type). Their Christmas holidays may also be extended.

A spokesperson for Jaguar says the move is an attempt to balance stocks for the remainder of the year – a short-term downward adjustment to avoid over-stocking.

He adds: “It’s an initial step in the actions we are taking to address Jaguar’s overall problems. Clearly, from the financial reports we’ve had recently, we have to make some other adjustments. “There’s a long-term plan for the entire operation under development at the moment, and nothing has been ruled in or out as yet.”

He declined to go into details, but said an announcement would be made in a matter of weeks – certainly by the end of this year.

In the US market, Jaguar sales in August were 38% down – due in part to exchange rates and a lot of incentive activity in the luxury sector – and are 12% down year-to-date. Globally, Jaguar sales are about 6% down so far this year. However, the long wheelbase XJ has just been launched in the USA, a key market for this vehicle.

At Land Rover, the management and workforce have been given an extra week to fine-tune the road map to future prosperity which Mark Fields, executive vice-president of Ford Europe and the Premier Automotive Group, originally gave them two months to complete (AM, June 18). If the new revised plan fails to impress, the Solihull plant could be starved of investment – leading to its closure.

Mark Fields said: “The road map did not reach the key metrics of quality and performance that were expected. The team did make good progress but not good enough. I told them there can’t be any half measures so there is still work to do and I gave them another seven days.” So, is motor manufacturing in the UK under threat? Not according to the SMMT’s Christopher Macgowan.

He says: “Land Rover has moved back into the black and their sales have risen. The Ford review is starting to pay off, which is great news. I have no doubt we are going to see some better news out of Jaguar as they, too, reshape the business. The UK continues to have more brands being built than any other EU member state. But you have to recognise it’s a global business, and highly competitive. What Ford is doing is responding to those competitive pressures.”

Dave Osborne, national secretary for the car industry at the T&G – the largest trade union at Jaguar – comments: “The position of Jaguar gives us cause for concern, particularly when the UK plants have performed so strongly. It is a tragedy Jaguar is having to cut production at the most efficient Ford plants.”

Tony Murphy, Amicus national officer for the automotive industry, added: “The news is disappointing but we’re happy Jaguar has looked at minimising the impact on workers rather than instantly looking to cut jobs. They are going to use some of the downtime to carry out maintenance work and provide extra training, which will benefit the company and workers.

“We hope demand in the US market will pick up soon and that the UK plants can weather the storm.”

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