Cars: Why Jaguar Land Rover has changed its tune over Brexit - PressFrom - United Kingdom
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CarsWhy Jaguar Land Rover has changed its tune over Brexit

04:40  04 july  2019
04:40  04 july  2019 Source:   theweek.co.uk

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Why Jaguar Land Rover has changed its tune over Brexit The Week (UK)11:33. Tata Motors-owned JLR looks to build on foundation of ten years in India The Times of India11:45.

Jaguar Land Rover has reported a drop in profits after slower sales growth and rising business investment. In April, the firm said it would shed 1,000 contract staff at two UK factories after uncertainty over Brexit and The Indian car giant said its fourth quarter net profit had halved to 21.25 billion rupees (£233.25m, 0.74m), from JLR cuts Land Rover production amid diesel uncertainty.

Why Jaguar Land Rover has changed its tune over Brexit © Getty

Jaguar Land Rover has performed a U-turn and announced that Brexit may have a positive impact on sales, whether or not Britain leaves the European Union with a deal.

Over the past two years, the British carmaker has repeatedly warned that a no-deal Brexit could result in tariffs for vehicles exported to the Continent, jeopardising the company’s profit margins and putting jobs at risk.

But in a drastic change of tone, the company’s UK managing director, Rawdon Glover, told Autocar that both Jaguar and Land Rover brands have “shown upswings” despite market uncertainty brought on by inconclusive Brexit negotiations.

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Ford and Jaguar Land Rover rue the day when the UK voted to leave the European Union. They now back Theresa May’s withdrawal deal That JLR has announced plans to produce electric drive units in Wolverhampton powered by batteries from Hams Hall in Birmingham helped sugar the pill of job losses.

Jaguar Land Rover has said that all of its new vehicles will be electrified from 2020 onwards; processes that offer “significant economic and productivity opportunities”, Speeth said. “Get Brexit wrong and British people, businesses and broader society lose the chance to lead in smart mobility.”

“There is so much uncertainty and all the indicators suggest consumer confidence is down, so there is reasonable cause to look to those concerns as a reason for depressing the car market,” he told the motoring magazine.

“So, thinking positively, you could say that any resolution to the Brexit impasse could help us emerge into a more favourable mindset, possibly even with pricing advantages for anyone building their cars in Britain,” he said.

“It’s a one-sided view,” said Glover, “but my job is to sell Jaguars and Land Rovers in the UK, and I can look therefore at potential upsides to us emerging from Brexit, hopefully with a clear vision for the future that gives people confidence.”

Why Jaguar Land Rover has changed its tune over Brexit © Getty Why the change of heart, JLR?

There seem to be a few key factors behind the company’s apparent shift on Brexit.

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Jaguar Land Rover ( JLR ) has said a bad Brexit deal would cost the company more than £1.2bn in annual profit. The numbers involved are huge: JLR , which makes more than 600,000 cars a year, says it often has 10 trucks a day on each of the routes mentioned above in order to support production.

Sales of Jaguar Land Rover cars have fallen sharply, taking the firm into a loss for the three months The firm blamed lower sales in China for the decline, as well as uncertainty in Europe over diesel and Brexit . Which is likely to mean a tough time for JLR and its suppliers. Jaguar said the fall in sales

Most of the warnings issued by JLR have come from its chief executive, Ralf Speth. In September, for instance, Speth told Sky News that the company’s 3,000 cars per day production line relied heavily on “just-in-time” supply lines, which may become disrupted if extra border checks were introduced.

“Just one part missing could mean stopping production at a cost of £60m a day. That is a huge risk,” he told the broadcaster.

Glover’s comments, however, are in regards to the sales of JLR vehicles. In April, the company reported that year-on-year sales had grown in the UK by 12.1%, suggesting that Brexit hasn’t deterred motorists from buying new cars.

Why Jaguar Land Rover has changed its tune over Brexit © Provided by Dennis Publishing Limited

This is partly due to the release of the new Range Rover Evoque (pictured top), says JLR, as well as the continuing success of the all-electric Jaguar I-Pace.

JLR also has a number of new models in the works, including the Land Rover Defender and a rumoured all-electric version of its XJ saloon - both of which are expected to be popular with buyers.

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Car maker Jaguar Land Rover has warned it urgently needs "greater certainty" on Brexit to continue to invest heavily in the UK and safeguard suppliers, customers and 40,000 British-based jobs. The warning from Britain's biggest car maker follows similar statements from BMW and Airbus.

Jaguar Land Rover has announced that about 2,000 staff will move to a three-day week at its Castle Bromwich plant in the West Midlands, only hours after the carmaker was accused of “scaremongering” about the impact of Brexit by a Conservative MP. JLR , owned by the Indian conglomerate Tata, said

But the company saw massive declines of 45.7% in China. Overseas markets also plummeted by 22.3%, while European sales dropped by 5.5%.

It remains to be seen whether strong UK sales will be enough to cover the ground lost in other key markets.

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Why Jaguar Land Rover has changed its tune over Brexit
Is the industry still concerned about Brexit?

Yes. While JLR appears to be less concerned about Britain’s divorce from the EU than it has been, other figures in the industry still fear a no-deal Brexit.

Yesterday, French motoring giant PSA revealed that it would continue to manufacture the Vauxhall Astra in the UK only if a deal with the EU can be reached before Brexit, the Financial Times reports.

Vauxhall’s Ellesmere Port factory in Cheshire “is heavily reliant on access to Europe”, the newspaper says. Around 80% of cars made there are exported to the Continent, meaning any border checks or tariffs imposed in the event of a no-deal Brexit could “severely hurt” business.

The Society of Motor Manufacturers and Traders (SMMT) frequently raises concerns over Brexit’s impact on the industry, too.

As reported by Reuters, an SMMT spokesperson said that “leaving the EU without a deal would trigger the most seismic shift in trading conditions ever experienced by automotive, with billions of pounds of tariffs threatening to impact consumer choice and affordability”.

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Jaguar Land Rover losses widen as Brexit plant shutdowns take toll.
Jaguar Land Rover (JLR) has reported a £395m first quarter loss partly blamed on plant shutdowns ahead of the original Brexit date. The loss for Britain's biggest car maker was 50% higher than in the same period last year and comes after it had edged back into the black with a £120m profit in the previous three-month period. JLR, owned by India's Tata Motors, said it sold 11.6% fewer vehicles in the three months to June than in the same period last year - consistent with its expectation of "weaker market conditions". China - buffeted by trade war fears - continued to see sharp declines, with sales down 29.

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