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JLR's CEO Has Left The Building. Here's Why You Should Care.

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Posted On: Jan 28, 2010 By: Al R. Budde Category: Land Rover News

Was it the halting of union talks, the “strategic differences”, or the fact that sales were in the dumper? The real reason could make all the difference...


David Smith, CEO of Jaguar Land Rover has left the company, who thanked him on his way out “for his efforts in the role and for his service to Jaguar and Land Rover over many years".

The company went on to say that Smith’s departure is “not linked to the recent breakdown of talks with unions over pay and pensions.” The talks centered on proposed changes to pay and pensions that the firm announced in September as part of its strategic review. Jaguar Land Rover has offered to guarantee that 8,000 full-time staff will be kept on until 2015 in return for cuts to new starters' salaries and pensions. The firm wants to trim the wages of new employees by 20%, among other things, but these talks between Jaguar Land Rover bosses and unions broke down last week after six days of discussions. 

A couple of days later, Smith was sacked.

But that had NOTHING to do with it. So get that thought right out of your head.

Jaguar Land Rover said director Ravi Kant would now assist with the handover of Mr. Smith's duties, and assume the day-to-day responsibilities of the chief executive role until a permanent successor was announced. Mr. Kant is one of Tata’s directors and a former Tata CEO, which points to the idea that maybe Smith wasn’t playing ball with the new owners’ ideas of how and where JLR should be marketed. 

Was Smith trying to save jobs? Besides job cuts and salary reductions, Tata also plans on closing at least one of its West Midlands plants. It does beg the question: Does this signal a possible shift of the firm from England to India? 

When these things happen, the light of blame usually shines on the numbers. True, sales across the firm's two brands declined by 26% in 2009… but whose didn’t? It was one of the roughest years in automotive history! Jaguar was down 33%, Land Rover - including Range Rover - were 23% lower. But now? Sales recovered in December, with Land Rover adding 45% from a year earlier, and Jaguar's rising 5%. Plus you’ve got the LRX coming, and you’re showing nice pick-up in India and China, two emerging markets where Land Rover in particular is establishing a strong presence. 

So long as the brand retains its “Britishness”, you could argue that it really doesn’t matter if its manufactured in India or Solihull. But it certainly matters to the thousands of British employees working in the West Midlands. And that’s why it matters. Stay tuned…

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