Two thousand more workers in Britain’s embattled motor industry are to lose their jobs after restructuring plans were announced by Aston Martin Lagonda, the luxury sports car maker, and Lookers, the dealership chain.
The number of job losses could increase if Bentley Motors lets up to 1,000 workers go through a voluntary release scheme today according to ITV News.
The industry and trade employ 800,000 but the plans by Aston Martin and Lookers show both reducing their workforces by nearly a fifth.
Even before the Covid-19 crisis, the British motor industry was in crisis. Jaguar Land Rover, the biggest automotive employer, has cut 6,000 jobs, about 15 per cent of its workforce. A further 5,000 jobs are going in the closures of Honda in Swindon and Ford’s engine factory at Bridgend, south Wales. There are fears that Vauxhall’s Astra plant at Ellesmere Port in Cheshire will not survive Brexit and the pandemic.
While manufacturing volumes and showroom sales have been in decline for three years, the crises at Aston Martin and Lookers are also self-inflicted.
Lookers, which reopened its showrooms on Monday, said that it had increased the number of dealerships it plans to close to 27, taking its number of outlets down to 136. The 1,500 employees being laid off form a significant proportion of its 8,100-strong workforce.
The company has been in such bad shape that Pendragon, another struggling dealership group, had proposed a merger that was subsequently rebuffed.
Lookers has delayed the publication of its accounts twice having lost one chief executive and two chief operating officers in six months. It is under investigation by the Financial Conduct Authority over sales protocols and by accountants from Grant Thornton over fraud at at least one operating entity.
At Aston Martin the cutting of 500 staff out of 2,600 is a bitter blow. Among those being made redundant are hundreds who spent thousands of pounds buying shares in the company’s stock market flotation in autumn 2018 — one of the biggest recent initial public offering flops in London. Floated at £19 a share, valuing the company at more than £4 billion, the shares are trading at 66p — and that after a £500 million-plus recapitalisation in which Lawrence Stroll, the Canadian billionaire, took control and became executive chairman.
The job losses come as the company goes into production of its first 4×4, the DBX, the model charged with transforming the group’s fortunes from its specially constructed factory at a former airport hangar in south Wales.
A spokesman for Aston Martin Lagonda said: “The measures will right-size the organisational structure and bring the cost base into line with reduced sports car production levels.”
Mark Raban, chief executive of Lookers, said: “We must adapt to ensure a positive future in what is likely to remain an uncertain environment.”