International automotive retailer Inchcape cuts 1900 jobs
Inchcape, the global car dealership, gave another big blow to motor industry by scrapping interim dividend and making 1900 employees redundant. It is predicting a sharp fall in its next year’s sales.
The announcement made Inchcape shares to slump by 28% to 50.75p.
The UK automotive industry has yet to receive government’s response to its plea for a rescue package for suppliers to tide over credit crunch and falling demand.
Inchcape which had announced redundancy of 1,600 staff previous day lifted the figure to 1900. It reported 4.9% drop in like-for-like sales in last 11 months. Although it is expecting to meet overall results for 2008, its sales were still falling and predicted to fall further next year as well. The company expressed its inability to forecast results with certainty due to unprecedented and quick decline in group’s many markets.
Britain tops the list of Inchcape’s worst affected markets with massive fall of 37% in last month’s new-car sales.
The picture is equally bleak elsewhere. Sales in Europe declined by 26%, while in Australia, the decline was 22%. The company has scrapped final dividend for 2008.
It is claimed that without government’s support industry would not be able to avert loss of thousands of jobs and valuable industrial capacity.
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