Jaguar Land Rover to Idle Factories in Britain Next Month
Jaguar Land Rover has decided to stall production at two of its British factories for several weeks. Starting in late February, JLR intends to stop work at both its Castle Bromwich Assembly and Solihull plants until the end of March. The factories won’t be totally inactive for the duration; the manufacturer claims there will be half days intermixed with full-day closures.
Unlike the bulk of plant idlings taking place across the globe (though mostly in China), this has nothing to do with the coronavirus. While the outbreak has begun disrupting supply chains as the PRC attempts to keep the illness in check by barring people inside their homes, JLR said it’s stalling UK production to address falling demand and Brexit complications — the latter of which is beginning to feel like a lame excuse.
Solihull is responsible for the Jaguar F-Pace, the self-titled Range Rover, Sport and Velar. Castle Bromwich is singularly focused on Jaguar and manufactures the XE, XF and F-Type.
“The external environment remains challenging for our industry and the company is taking decisive actions to achieve the necessary operational efficiencies to safeguard long-term success,” the company explained to Reuters. “We have confirmed that Solihull and Castle Bromwich will make some minor changes to their production schedules to reflect fluctuating demand globally, whilst still meeting customer needs.”
JLR posted a 2.3 [percent] drop in retail sales in the three months to the end of December and has targeted billions of pounds worth of savings to tackle falling diesel demand in Europe and a tough sales environment in China.
While the Chinese sales decline had everything to do with the economy, the coronavirus is expected to have serious ripple effects if it’s not dealt with soon. About 60 million people are still living under lockdown as the virus continues to spread, and sales and assembly in the region are expected to be heavily suppressed until the disease can be wrangled. Supply chains will also worsen, leaving companies that source components from the area in dutch.
Jaguar Land Rover parent Tata Motors has already said it believes the outbreak could negatively impact JLR’s profit margin forecast by around 3 percent this year. Considering it was in the midst of a plan to turn things around in China, and also has to contend with a difficult European market, the company already had enough to contend with.
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