More bad news for Jaguar and Land Rover who were purchased from Ford by Indian automaker Tata Motors for $2.3 billion last march. The already struggling British manufacturers have announced that they will cease production for a week at the end of October at their Halewood plant. This comes after a number of other “black” days where production has slowed or stopped at other plants.
Tata yesterday released an illuminating statment that, “Consumer decisions as to whether and when to make a vehicle purchase may be affected significantly by general economic conditions, including the cost of purchasing and operating a vehicle and the availability and cost of credit and fuel. Tata Motors said the combined losses of the luxury brands exceeded $383 million between January and June 1. Despite that gloomy figure, a spokepeople for the company tried to put a good face on the situaton by stating, “This is half-term holiday week and, traditionally, this has always been a week when production ceased…..although not at Halewood.” Later they admitted that the halt in production was an attempt to address falling demand. Despite these announcements, Tata contends that Jaguar/Land Rover has had a strong start to the year. This seemingly contraditory attitude is the result of Land Rover’s three successive years of record sales, including 2007, which marked the first time the brand had sold more than 200,000 vehicles a year. This news follows years in which Jaguar and Land Rover failed to turn a profit for previous owner Ford, though losses were previously obscured somewhat by Ford’s inclusion of Jaguar and Land Rover with Volvo in its Premier Automotive Group Division. Indications are that conditions in the coming months will not improve much despite plans to sell more new cars in Asian, Russian and Indian markets.
The Halewood plant produces Land Rover’s Freelander 2 and Jaguar’s X-Type car. The Freelander 2 and has been a success with worldwide sales of 65,363. In response to the dipping sales in North America, Land Rover is developing new vehicles and new technologies to meet growing demand for more environmentally-friendly and fuel-efficient vehicles. Its small LRX “concept car”, which uses hybrid engine and bio-diesel and will likely be built at Halewood if it goes into production.