It has been a bad start to the year for UK car manufacturing. Iconic UK-based automaker Jaguar Land Rover (JLR) announced job cuts of up to 5,000 from its UK workforce of 40,000, while Ford Europe unveiled a major cost-cutting review of its European operations.
It would be easy to blame Brexit, but this is not what is driving change. It is the slowdown in Chinese orders and falling consumer interest in diesel engine vehicles.
Both JLR and Ford are looking towards transformative reorganizations for a future in which electric cars rather than diesel engines are the name of the game. While JLR will cut jobs in the UK, it will still build a new factory in Warwickshire to produce batteries, and its electric motors will be manufactured at its site in Wolverhampton.
According to a Reuters survey published January 10, automakers globally will invest $300 billion in electric vehicles (EVs) over the next 5 to 10 years, 45% of which will be in China, with 46% of the investment capital emanating from Germany.
It is evidence of the tectonic forces impacting the transportation sector, which accounts for just over 60% of oil demand. According to a recent report from energy consultants Wood Mackenzie, oil demand from transport will level out around 2030, leaving petrochemicals as the main, perhaps solitary, engine of growth.
With the International Maritime Organisation’s new rules on sulfur in marine fuel now less than a year…