Jaguar Land Rover to cut thousands of jobs amid automotive market troubles

British automaker Jaguar Land Rover (JLR) plans to cut about 4,000 jobs worldwide over the next two years. The company is implementing a major cost-reduction program of £1.7 billion amid American tariffs, weak sales, and the aftermath of a major cyberattack.

The cuts will amount to about a tenth of JLR's global workforce, which numbers about 44,000 employees. The main impact will be on salaried and managerial positions, while workers directly on production lines will largely be unaffected by the cuts.

Most of the cuts are expected in the United Kingdom, where JLR employs about 34,000 people. This includes, in particular, managerial units, marketing, as well as research and development. In the first phase, the company plans to use a voluntary redundancy program.

Company wants to cut costs by £1.7 billion

JLR CEO P.B. Balaji explained the decision by the need to make the company more competitive amid technological changes, intense competition, and geopolitical uncertainty.

As part of the Growth Reimagined strategy, the automaker plans to simplify its organizational structure and lower the sales volume needed to break even to about 300,000 vehicles per year. Total savings over two years are expected to be about £1.7 billion.

The company's financial situation has deteriorated significantly. JLR's pre-tax profit for the past year fell to £14 million from £2.5 billion a year earlier. One of the reasons was a major cyberattack, which forced the company to halt plants. Its direct losses from the incident were estimated at about £200 million.

JLR pressured by American tariffs and China

An additional blow came from American tariffs, which worsened sales conditions for Range Rover, Defender, and other JLR models in one of the key markets for the company. The automaker has no own production in the US and is even considering cooperation with Stellantis to produce some vehicles in the country.

At the same time, JLR has faced a downturn in sales in China and increased competition from Chinese automakers. The company continues significant investments in electric vehicles, in particular preparing electric models of Range Rover and Jaguar.

JLR's cuts come amid a broader restructuring of the European automotive industry. Major manufacturers are trying simultaneously to cut costs, fund the transition to electric vehicles, and counter increasingly strong competition from Chinese brands.

Based on: The Guardian, The Wall Street Journal