Why Jaguar Land Rover is idling its UK assembly plant

Land Rover factory

Shares of Tata Motors hit a six-year low of Rs 185 per share, down 13% on the BSE in intra-day trade on Tuesday, after the company-owned Jaguar Land Rover (JLR) on Monday, reported a 12.3% year on year (YoY) decline in global sales at 57,114 units in September, hit by lower demand in China.

Chinese sales almost halved, falling 46.2 per cent, with JLR blaming import duty changes and trade tensions for hurting consumer appetite.

Sales of Jaguar brand of vehicles in September were at 19,146 units, an increase of 4.4% over September 2017, the company said in a statement.

JLR sold 57,114 cars in September, a 12.3 per cent year on year drop, with the firm shipping nearly 20 per cent fewer Land Rovers than September 2017.

Britain's biggest carmaker Jaguar Land Rover will close its Solihull auto plant for two weeks from October 22, the Unite union said on Monday.

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It took the decision after reporting a 46% slide in sales to customers in China, a key market for models made at the plant, where the production line makes Range Rovers and the Land Rover Discovery SUV.

JLR sales fell 0.8 percent in the United Kingdom and 4.7 percent in Europe, which saw large industry declines of 20.5 percent in the United Kingdom and 31 percent in Germany primarily relating to the timing of new WLTP homologation rules as well as reduced diesel demand, it added.

The freeze at Solihull is not Brexit-related but Jack Dromey MP, whose constituency includes the Castle Bromwich plant, said JLR's difficulties underscored the need for the automotive industry to be protected in the UK's agreement with the EU. It attributed slower production plans to weakening global demand, especially in China, and weakness in diesel sales.

The Unite union called the news deeply troubling.

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