Jaguar Land Rover (JLR) will close one of its two West Midlands plants and create 800 new jobs at its Liverpool plant to develop a new fuel-efficient SUV.
David Smith, chief executive of JLR, confirmed the new business plan, saying it was a response to the impact the recession has had on business.
By the middle of the next decade, JLR will merge operations of its plants at Castle Bromwich, which is staffed by 2,000 employees, and Solihull, which has 4,000 employees. The company will decide which plant to close next year.
The plan does not include compulsory redundancies and JLR claims new jobs will be created at its Halewood plant in Merseyside for the production version of its LRX Concept, which will be the smallest and most fuel-efficient Range Rover available from Land Rover.
Despite these promises, the announcement has ignited fury from Unite. The union’s national secretary for the automotive sector, Dave Osborne, said JLR has backed out of an agreement Unite made with the carmaker earlier this year to support the company through the tough economic period.
‘Our members said then that JLR could not be trusted to uphold that agreement,’ he added. ‘Today this has proven to be true.’
JLR’s previous attempts to beat the recession this year have included reducing production by more than 100,000 units, freezing employee salaries and cancelling bonuses.
Osborne said JLR employees now fear the company is seeking to close the final salary pension scheme.
‘In April our members agreed to changes to terms and conditions of their employment in order to give the company financial security, but like Oliver Twist they are coming back for more,’ he added. ‘It appears that the company is making our members pay for their failure to secure government funding.’
JLR insists the restructuring plan is necessary to increase the cash flow and profits that are essential to secure its future. Other plans announced yesterday include investing £800m into environmental innovation. The funds, supported in part by the European Investment Bank, will go toward technologies that significantly reduce carbon dioxide emissions.