Plans by Jaguar Land Rover to cut production at its Halewood plant in the U.K. citing Brexit and concerns about the future of diesel and petrol vehicles gained political attention as critics of the government pointed to the development as an example of the damage wrought by uncertainty around Brexit and government policy on future engine systems.
Late on Monday, JLR, part of Tata Motors, said that following a regular review of production schedules, “temporary adjustments” would be made to production at Halewood, where the Range Rover Evoque and the Land Rover Discovery Sport are assembled, in a move that had already been communicated to the workforce.
The company pointed to the uncertainty around Brexit, which had hit demand in Britain, where demand for new cars had fallen by 5.7% in 2017, as well as more widely across Europe, which accounted for 45% of U.K. production. “Add to this, concern around the future of petrol and diesel engines, and general global economic and political uncertainty and it’s clear to see why industry is seeing an impact on car sales,” it said.
Earlier this month, the firm said it had sold over 620,000 units in 2017, its best year to date, though it had pointed to “tough conditions” in key markets including Britain.
Liberal democrat leader Vincent Cable, a strong opponent of Brexit, pointed to the development, raising questions about the impact on jobs, and knock on effects on the supply chain, including at the JLR engine plant in Wolverhampton. The development was also widely picked up on social media by pro-Remain groups, with some using it to bolster their case for the need for Britons to have another opportunity to decide on Brexit.
Diesel engine policy
“Brexit uncertainty along with the government’s confused policy on diesel engines [is] to blame,” said Len McCluskey, general secretary of the Unite union, who said they were in close dialogue with JLR.
Alongside Brexit, JLR and the wider car industry have repeatedly pointed to the direction of government policy regarding the internal combustion engine, as another major challenge awaiting the industry. Vehicle makers have already begun preparing for a new policy environment globally, amid an array of plans to push car makers towards the production of electric vehicles. Britain plans to ban the sale of conventional diesel and petrol cars from 2040 onwards, though industry has called for greater clarity, as well as initiative from the government in terms of infrastructure support. In early January the industry body, the SMMT, announced that in 2017, Britain’s new car market fell for the first time in six years. While sales of hybrid, electric and hydrogen fuel cell cars rose sharply, and there was a modest rise in sales of petrol cars, there was a sharp fall in diesel sales amid concerns about future regulation and levies on such vehicles.
