Jaguar to cut 1,150 jobs at main plant as part of revamp

Ford Motor Co's luxury brand Jaguar said it will eliminate around 1,150 jobs at its main British plant in Coventry, central England, under a revamp of the prestigious but loss-making division.

In another blow to Britain's fading glory as a carmaking centre, Jaguar will drastically scale back the Brown's Lane plant and shift manufacturing of its XJ sedan and XK sports car to its Castle Bromwich factory to address excess capacity.

Jaguar will keep 310 jobs to make wood finishings at Brown's Lane, move 425 staff to Castle Bromwich, and add 300 new manufacturing jobs at the Ford group's Aston Martin sports car plant in Gaydon, also in central England, the company said yesterday.

Unions vowed to fight the restructuring plans.

"We are going to fight it," a spokesman for Amicus, one of the two main unions representing Jaguar workers in Coventry, said.

"We think this is the thin end of the wedge. It means Brown's Lane will not be viable for the longer term," he added, though he declined to say whether Ford's UK workers might consider industrial action.

"Coventry remains Jaguar's home. We will retain Brown's Lane as the headquarters of Jaguar," one industry source said.

But the moves to shore up profits at Jaguar reduce the Coventry plan to a shadow of its proud past.

To help cushion the blow, Jaguar said it would develop three new products: a new all-aluminium sports car, a premium diesel version of the XJ sedan, and a high-performance X-type diesel.

Born in 1922 as the Swallow Sidecar Co. in Blackpool with a £1,000 bank overdraft, Jaguar has made its sleek and distinctive cars since 1935. It sold 120,570 cars last year.

But sterling's strength against the dollar has hurt business in North America, which accounted for nearly half of Jaguar's sales in 2003.

Ford, which cut a deal with unions this month to save its British sport-utility vehicle maker Land Rover, has been grappling with overcapacity at the Jaguar plants where the iconic British luxury cars are made.

It said last month it would reduce Jaguar's planned 2004 output by about 15,000 units to help clear inventories amid tough competition in the luxury segment, but the largest union at Jaguar said then it had been assured no jobs would go.

The division's disappointing performance is weighing heavily on overall results at Ford's Premier Automotive Group, which also comprises Land Rover, Volvo and Aston Martin.

Ford's luxury car business is key to its goal of booking $7 billion in annual pretax profits by 2006.