Mumbai: The Tatas-owned Jaguar & Land Rover (JLR) has offered to hike salaries of over 21,000 employees by 7.5 percent effective next month, subject to ratification by the union members through a ballot that is likely to take place soon, according to a company official in Mumbai.

"We have offered a 7.5 percent wage hike to over 21,000 employees of JLR in two tranches. While the first hike of 4.5 percent will be effective from November 1, the second increase of 3 percent will be from November 1, 2013," a spokesperson for JLR in India told media on Sunday.

However, he added, that the proposal has to be approved by the union members through a ballot, which will take place any day from now.

When asked whether the management is hopeful of the union approval, he said, "we hope so," adding under the British labour laws, wages have to be upped in every three years and so is the balloting process.

Tata Motors bought the sick JLR from Ford Motor in the middle of the global credit crisis in March 2008 for USD 2.3 billion.

According to British media reports, the offer is one of the best in England and is likely to go through with the unions, and comes in the wake of robust sales in recent months.

In the three months ended June, the carmaker reported a 34 percent spike in sales, selling 83,452 units. The surge is driven by the new Range Rover Evoque, the spokesman said, adding the booming demand is driven by China, the US, Russia and England in that order.

China alone accounts for about a quarter of total sales, up from 15.7 percent a year ago and is the largest market now for the company.

JLR, which makes the English marquee brands under Jaguar and Land Rover labels, has five plants in the isles and employs over 21,000, who are affiliated to many unions including the Unite Union, which has 17,000 members at JLR.

The five JLR plants are located at Castle Bromwich, Solihull, Gaydon, and Whitley in the West Midlands, and Halewood in Merseyside.

Globally, JLR employs around 25,000, the spokesperson said, adding the wage hike is only for its British workers.

The deal also involves making 2,400 agency workers permanent employees from next month, according to English media reports.

On the Chinese joint venture with Chery Automobile, under which the JV will be pumping in USD 1.92 billion for an assembly line near Shanghai, the spokesperson said they got a "verbal approval" a few weeks back and are awaiting "a formal communication".

On September 21, the National Development and Reform Commission of China gave the regulatory go-ahead to JLR's JV with Chery to set up an assembly line in Changshu city near Shanghai with an annual capacity of 130,000 cars. The JV will initially roll out the Land Rover SUVs and the Jaguars in the second phase.

The JLR deal will help raise the profile of Chery, which is a mass volume player aspiring to gain access to the lucrative upscale segment dominated by foreign brands in the world's largest Motown, where luxury sedans and SUVs are being snapped up like hot cakes.

On India plans of JLR, the spokesperson said, there has been a massive jump in demand, and from next year its Pune facility will roll out the Freelander. The company sold 2,400 units last year in the domestic market driven by various Land Rover models (60 percent) and the Jaguars.

He also said as part of market making, the company will have 20 outlets by the end of this year from the present 15.

The spokesman further said, apart from the recently announced 2 billion pound capex on new engine developments over the next two years, the company is spending 370 million pounds in a new paint and aluminium body shops and another 300 million pounds in a new engine plant in England.

Over the past two years, the company had hired 3,100 employees and 1,000 engineers at various plants in England apart from creating an equal number of ancillary jobs.


Latest News from Business News Desk