(Bloomberg) -- Jaguar Land Rover expects to reduce its global salaried workforce by about 2,000 people in the next financial year as the luxury carmaker cuts costs under a new chief executive officer.
The company, owned by India's Tata Motors Ltd., has started briefing employees about plans for a reorganization, it said in an emailed statement Wednesday. JLR announced a 2.5 billion-pound ($3.5 billion) annual budget for investment in electrification and related technologies earlier this week and said the Jaguar brand will go entirely electric by 2025.
“Things have already started turning around for Tata Motors and JLR,” said Basudeb Banerjee, an analyst at Ambit Capital Pvt in Mumbai. “Further cost-reduction initiatives will help.”
JLR reported a 38% rise in profit last quarter as pent-up demand aided a recovery in markets led by China.
Ditching internal combustion engines will be a tall order for Thierry Bollore, the former CEO of Renault SA who joined JLR in September. The company's only fully electric vehicle is the Jaguar I-Pace SUV, and sales have been disappointing. JLR failed to comply with Europe's carbon-dioxide emissions rules last year and set aside 35 million pounds for expected fines.
JLR has 37,000 employees, including about 30,000 in the U.K. The company said the reorganization won't affect hourly manufacturing workers.
Tata Motors shares fell 0.4% as of 11:10 a.m. in Mumbai. The stock has surged almost 80% this year, amid investor optimism that improving demand and sharp cost cuts will boost efforts to reduce the firm's massive debt pile.
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