Jaguar LandRover Want Bail-out Cash.

[Dave Lewis]

p.s. Hawk20 is right btw

No he's not. As an economist, he knows full well that if Land Rover sales are down 58%, it's a result of market forces, not the opinions of environmentalists. All car sales are down, small and large. Honda, Mini, and others are cutting production due to a drastic fall in demand.

 

[grober]

Yes. The beard and sandal brigade are slowly killing off large cars. Shame.

No need to be so harsh about the beard and sandal brigade , after all this guy has a big family to support.

 

[grober]

Summing up the problem pictorially the company might have been better placed now had they been pushing out all the stops to give us this type of diesel hybrid 4x4- 120g/km CO2 a couple of years ago http://www.channel4.com/4car/ft/feature/motor+show/12994/1 but gave us this 2 ton 244g/km CO2 behemoth instead. What is frustrating is that they obviously had the design flair and engineering expertise ( e.g. jaguar's alloy body construction) to do this but failed to read what vehicle characteristics future markets might demand and now have a range of models which are perceived as difficult to sell. Easy to say in hindsight I know but Ford must have had a team of highly paid market analysts who either didn't see this coming or chose to ignore it.

 

[Dieselman]

Summing up the problem pictorially the company might have been better placed now had they been pushing out all the stops to give us this type of diesel hybrid 4x4- 120g/km CO2 a couple of years ago

Which raises a point. Does Ford have any hybrid/Eco cars at all.?
They had a project called the 'Think' which they sold off to the Norwegians and looks like it's going to be a reasonable sucess.

Irrespective of whether we like them or not, Eco cars are what is going to sell and make money.

 

[grober]

There's this- THE ESCAPE. http://www.fordvehicles.com/suvs/escapehybrid/index.asp

 

[Defiant]

I want some Bail-out Cash, too. Please?I'd be really grateful.

Thanks so much, in advance.

 

[vincenz]

I think one the issues with JLR is that whatever profit they made last year and early this year, it all ended up in Fords coffers and this has led them to a credit crisis of their own, as we all know of the huge sums involved in running a car company.

Coupled with a model range that is super exposed to the current financial down turn (big engines, expensive cars) its no suprise they are struggling.

The LRX concept (pictured above) shows their determination to change the percived image of 4x4's, it has a claimed MPG of 55+ and will be made from much recyled and lightweight materials.

On top of their employee base and all the suppliers that feed the company I think they are a worth while company fro the government to lend to, better than the demise of 20,000+ jobs (staff and suppliers combined).

 

[Dieselman]

better than the demise of 20,000+ jobs (staff and suppliers combined).

We always see figures of large supplier redundancies when a car manufacturer gets into trouble, but as the suppliers also supply to other manufacturers is that really the case if they lose say 15% of their work.?

 

[st13phil]

...is that really the case if they lose say 15% of their work.?

In the manufacturing sector a 15% drop in volume can easily be the difference between having a future and going broke very quickly. In general you simply cannot shed cost quickly enough in a capital-intensive business that runs on such slim margins as the automotive supply companies.

 

[vincenz]

Good point, Hella, for instance, won't bat an eye lid, they can supply head lamps left right and centre, so no they would just write off their JLR tooling and job done.

But Joe Bloggs tooling on an industrial estate in Knowsley who supply consumable for the X-Type line (for instance) will be affected.
As will medium sized suppliers located close to the plants (Halewood, Castle Bromwich and Solihull) who supply components like seats, bumpers etc also will go under.

If JLR fully intend to pay the money back I don't see the problem in lending to them.

 

[Dieselman]

In the manufacturing sector a 15% drop in volume can easily be the difference between having a future and going broke very quickly. In general you simply cannot shed cost quickly enough in a capital-intensive business that runs on such slim margins as the automotive supply companies.

But then a competitor would pick up the remaining 85% of the work left which would create new jobs.

 

[vincenz]

But then a competitor would pick up the remaining 85% of the work left which would create new jobs.

Not if theres no car factory to supply to

 

[st13phil]

But then a competitor would pick up the remaining 85% of the work left which would create new jobs.

Competitors would most likely be running under 100% of their capacity and would probably mop up most of the work between them without adding capacity through extra labour, so no "extra" or "new" jobs.

As vincenz says, the big players would hurt less than the small and medium size ones who would quickly fail.

 

[Dieselman]

Competitors would most likely be running under 100% of their capacity

I thought you said manufacturing for car manufacturers was tight margin work, in which case why would they be running under capacity.? Surely they would make more profit if they were more efficient.

All the component manufacturers I know deal with at least several car manufacturers, so losing one shouldn't spell disaster.

 

[vincenz]

I thought you said manufacturing for car manufacturers was tight margin work, in which case why would they be running under capacity.? Surely they would make more profit if they were more efficient.

All the component manufacturers I know deal with at least several car manufacturers, so losing one shouldn't spell disaster.

If your volumes drop, your costs go up.

The is becuase instead of hella making you 40,000 headlamps they make you 34,000 (15pc) drop.
They charge you more per head lamp, (as theyre not buying 80,000kg of polymer pellets for the head lamps, theyre only buying 68,000kg).

If your head lamp, seat, bumper, head lining, engine, battery etc supplier all do this at the same time you can go from making £500 a car to loosing £20, and then your fudged for cash flow.

I appriciate the majority of suppliers may deal with more than one manufacturer but in the Uk there are plently who only supply to JLR.

 

[Oli]

I think we could all agree it would be a huge shame if Jaguar or Land Rover went under, the XJR,Range Rover and Defender in my opinion are some very iconic British cars and it would be a shame not so see any future models of them.

 

[Birdman]

Yes. The beard and sandal brigade are slowly killing off large cars. Shame.

Hoi! I'm wearing sandals and sporting a beard and mine's a 5.4 litre V8 :bannana:

(Thinking of removing beard and sandals...)

 

[st13phil]

I thought you said manufacturing for car manufacturers was tight margin work, in which case why would they be running under capacity.?

They're running under capacity currently because manufacturing volumes have dropped throughout the market, not through their own choice or plans. Prior to the current market contraction they were, indeed, running at 100% capacity. Now take one major customer out of the picture and volumes drop again dramatically - critically so for those who have a significant proportion of their output with that one customer. Any other work the failed supplier did may then be redistributed amongst other suppliers, but the jobs will have gone.

 

[hawk20]

Nothing to do with the fact these things are not particularly cheap to buy and maintain and drink fuel. Oh and there's a global recession.

Blame the greens anyway its all their fault

Ade

The pressure to go small was well under way long before the recession. And the anti 4x4 propaganda goes way back.

 

[rf065]

The pressure to go small was well under way long before the recession. And the anti 4x4 propaganda goes way back.

Too true, but the announcement of increased VED levels, and backdating them to 2001 vehicles, has killed the car market in one stroke.

Russ