Jaguar Land Rover U-turn: all three UK plants saved

Jaguar Land Rover today surprised us all by announcing that it wouldn't be closing any of its three UK plants. CEO of Tata Motors Carl-Peter Forster had told CAR as recently as the Paris motor show a few weeks ago that one plant would shut.

Instead, today the unions and Jaguar Land Rover hailed a landmark deal to save jobs and all three plants at Castle Bromwich, Solihull and Halewood. The planned expansion of JLR - and a raft of new models - has persuaded bosses to keep all three sites open to fuel the planned expansion.

Forster told CAR in Paris: 'We are at a total volume today of around 250,000 vehicles. In the medium term, we see that rising to say around 300,000.'

Was Forster playing politics and scaremongering with his comments at Paris. Very probably. However, trade unions will now unanimously recommend their members accept the deal. Staff have accepted changes to their jobs and in return all three factories will remain open and 'thousands' of new jobs created.

A Jaguar Land Rover statement today said: 'This will lead to the creation of thousands of new jobs in Britain over the next decade as Jaguar Land Rover invests billions of pounds in the UK and significantly increases both the number of models in its range as well as overall global volumes.'

The company has already started recruiting a further 1500 workers for its Halewood plant, to integrate production of the new Range Rover Evoque.

JLR chief exec Ralf Speth added: 'We have ambitious plans for growth and the success of our products around the world and this agreement will allow us to accelerate and realise those plans.

'Our parent company Tata supported us through the recession and our employees also made sacrifices but now we are seeing a great turnaround in the business and everyone involved – our employees, our customers and our Tata shareholders – will benefit from this agreement. This is truly the beginning of a new era for Jaguar Land Rover.'

The unions have struck a deal which includes a 5% pay rise in November 2010 and a further rise of at least 3% in November 2011. However, new staff will come in on lower rates of pay and receive lower shift premiums, increasing flexibility. Existing employees are unaffected. There will also be an extension of performance related pay for salaried employees.

By Tim Pollard