Fears for jobs as Jaguar dives £90m into red

BRITAIN’S biggest car maker has launched a £2.5bn turnaround plan after problems in all its major markets pushed it into the red.

Jaguar Land Rover posted losses of £90m for the second quarter, having made a profit of £358m in the same period last year.

Revenues fell 10.9pc to £5.6bn in the three months to the end of September as demand slowed in China and diesel car sales in Europe slumped.

Now, a dramatic plan to revive its fortunes is raising concerns investment in its UK plants might be at risk.

JLR employs around 40,000 people in Britain.

It cut 1,000 jobs in its Solihull factory in April as Range Rover and Discovery sales stalled.

David Bailey, motor industry specialist at Aston Business School, said JLR faced a ‘perfect storm’ which would inevitably lead to more job losses.

He said. ‘I think we’d expect to see more in the New Year. I can’t see how they’d make £2.5bn of savings without laying off workers.’

The firm sold 129,887 vehicles in the second quarter, a fall of 13pc. The car maker also said the introduction of new EU emissions testing had affected sales.

In response, it has launched two wide-ranging initiatives, dubbed Charge and Accelerate, to slash spending and improve cashflow over the next 18 months. It will cut annual planned spending by about £500m to £4bn for the current financial year and the next. JLR recently paused production at plants in the west Midlands but the Coventrybased group said it expects to break even by the end of the year.

Chief executive Ralf Speth said yesterday: ‘JLR has launched far-reaching programmes to deliver cost and cashflow improvements.’

Tata Motors bought Jaguar and Land Rover from Ford in 2008.