Jaguar Land Rover racks up a record £3.6bn in losses as its diesel sales slump - but insists it won't merge with Peugeot
- Losses were mostly due to a £3.1bn write-down in the value of its investments
- This came as sales for cars such as the Jaguar saloon halved
- The firm has been hit by plunging demand in China from the US-China trade war
Jaguar Land Rover racked up a record loss after diesel sales slumped – but insisted it is not trying to merge with French firm Peugeot.
Britain's largest car maker swung to a £3.6 billion loss for the year ended March 31.
This was mostly due to a £3.1 billion write-down in the value of its investments in the third quarter, after demand for some of its newer models plunged.
Jaguar Land Rover racked up a record loss after diesel sales slumped – but insisted it is not trying to merge with French firm Peugeot
Around half of this was because existing investments such as factories, equipment and car designs are worth less than previously hoped due to the problems faced by the industry.
And the rest was money wiped off in an accounting correction because the firm expects to earn less in coming years than it previously expected. It came as sales for cars such as the Jaguar saloon halved compared with the same period the year before.
The company has struggled with plunging demand in China – made worse due to the US-China trade war triggered by President Trump – and drivers ditching diesel cars since the Volkswagen emissions scandal emerged in 2015. Much of its range is diesel-powered.
It did not provide an update about widespread rumours that its parent company, Tata Motors, is planning to sell a stake in JLR to the French company PSA Groupe, which is behind Peugeot.
But a board member denied the rumours, saying: 'Every two weeks this comes out. Every two weeks we make the same comment. There is no truth to these rumours. We do not comment on speculation.'
Land Rover has been struggling since the downturn in demand from China, one of its biggest markets
The British firm - owned by Tata - announced it was to cut around 4,500 jobs across its UK plants earlier this year
JLR, which was bought by India's Tata for £1.2 billion in 2008, said the situation is starting to improve. It made a £120 million profit in the last three months of the financial year. The company – which employs about 40,000 people in the UK – put this down to huge rounds of cost-cutting paying off after it announced plans to axe 4,500 jobs earlier this year.
Chief executive Ralf Speth said JLR – which also makes the luxury Range Rover models – has been one of the first companies in its sector 'to address the multiple headwinds simultaneously sweeping the automotive industry'. He claimed that JLR's turnaround plan has already saved £1.3 billion.
Full-year revenue came in at £24.2 billion, down from £25.8 billion the year before. It sold 6 per cent fewer vehicles, or 578,915, which it put down to weakness in China.
But the company said it is seeing solid sales for several of its new cars, such as the Jaguar E-Pace and Range Rover Velar.
Tata Motors' finance chief, Pathamadai Balachandran Balaji, said he expects Chinese sales of its sleek Jaguar saloons and Land Rover SUVs to return to growth later this year. JLR had made a profit of £1.5 billion in its previous financial year, 2017/18.
Ford to cull thousands of jobs worldwide
Ford will cut 7,000 jobs worldwide – around 10 per cent of its global workforce – in a bid to slash costs.
Ford will cut 7,000 jobs worldwide in a bid to slash costs
The American car maker said the job losses would be made through a mixture of voluntary and compulsory redundancies.
About 2,300 roles will be axed in the US and 1,200 in Germany.
It has yet to be clarified how many of its 12,000 UK jobs are at stake, though recent reports claim it will mainly between 500 and 550 'white collar, salaried employees'.
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