Over the next few years, life in the UK is going to be pretty – austere. The Centre-Right government has been in power barely a month, and already they’ve slashed the budget by £6.2 billion. That was just the scalpel, wait till the axe comes. So, with a possible second recession in the offing, it’s time for some good news. And here it is…
The BBC reports that Tata-owned Jaguar Land Rover (JLR) is going to start assembling their vehicles in China. ”We will need to manufacture at least 2 models in China,” said Carl-Peter Forster, JLR’s Chief Executive. “We’ll take 1 to 2 years to set it up, first we’ll need a partner.” That’s right, JLR isn’t above Chinese law, and they have to look for a Chinese joint venture partner. Then, the joint venture needs to be approved by the government. (Not that they usually are against it.)
Why China? Jags and Land Rovers are moving. Much of the growth came from China, where Jaguar sales rose 38 percent and Land Rover sales rose 55 percent during the year. India is also strong.
Mr Forster was quick to quell any fears that going to China might take any work from the UK based factories. Despite the growth in China and India, Forster said that either countries would “never be the centre for Jaguar Land Rover, it will remain in the UK. Most of the volume growth in these markets will benefit the UK operations”. Aha. By the way, JLR will produce Land Rovers in India next year.
At the same time, Forster is pushing for the closure of one of the factories in the UK, in the name of the almighty efficiency: “We are talking about having one efficient operation rather than 2 inefficient operations said Mr Forster, “We are not necessarily talking about getting rid of people.” Not necessarily?
An extra 1,000 jobs will be created in the UK – temporary jobs. Forster had an answer for that, too: “It takes a year or two before the jobs become permanent,”. With last financial year sales for JLR at 193,982 and with JLR expecting to top 200,000, the future looks rosy for JLR in Carl-Peter Forster’s eyes.
Forster has more ambitious plans. He wants to defy Newton. “The centre of gravity for the European auto industry is on the Continent and we have to pull the centre of gravity towards the UK.”
Start pulling, Pete! Anything that boosts exports and secures jobs for the UK is good in my eyes. With the upcoming budget cuts the UK faces, any foreign money is welcome. Even if Mao’s head is on it.