News - Jaguar
Jaguar fights for survival
Struggling Jaguar closes assembly plant, reduces production
22 Sep 2004
STRUGGLING Ford-owned brand Jaguar Cars announced last week it would end vehicle production at its Browns Lane assembly plant in Coventry, England, in September 2005.
It will also withdraw from Formula One racing at the end of this year, Ford deciding it can no longer make a compelling business case for any of its brands to compete in the sport.
With sales down 11.5 per cent in the US this year and the brand considered a main contributor to the Premier Automotive Group’s current financial woes, Jaguar will also reduce production by 15,000 units this year to better align stock with the current demand.
"Decisive action was needed to get Jaguar back on track and to ensure a viable future," PAG boss Mark Fields said in a statement released this week.
"Despite the actions taken by the company’s management over the past few years and despite the fact Jaguar is again the highest rated European brand on product quality, Jaguar is back in a serious loss-making position.
"There are a number of external factors which have exacerbated the situation but we have faced and tackled the fundamental reality, that Jaguar simply cannot support three assembly plants with annual sales of 125,000 cars."Browns Lane will keep open its wood veneer production facility, however production of the XJ sedan will be shifted to the company’s plant at Castle Bromwich, England. This plant will also build the new generation, all-aluminium XK sports car, which remains on track for a European debut in the first quarter of 2006.
Other product actions still in progress include the XJ and X-Type ranges each receiving a high-performance diesel engine for Europe and, for the US, a long-wheelbase XJ and an X-Type station wagon.
Retail infrastructure and model variants will be reviewed across the world.
"What we have developed is a series of actions to strengthen Jaguar," Mr Fields (pictured) said.
"These also include a leaner organisation structure on the cost side of the equation and on the revenue and brand side, a package of product and marketplace actions which will drive the company forward in a way which is more appropriate for the brand and will drive a better bottom line.
"There is massive global affection for the Jaguar brand but frankly we were operating to a business model that really offered little chance of generating sustained profitability except in times of favourable exchange rates. That had to change." Jaguar’s Formula One businesses are for sale.
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