Jaguar Land Rover is to shed 1,000 jobs and cut production at two sites, according to reports.
The carmaker said it would make an announcement to employees on Monday regarding its production plans for 2018/19.
It added: “In light of the continuing headwinds impacting the car industry, we are making some adjustments to our production schedules and the level of agency staff.
“We are however continuing to recruit large numbers of highly skilled engineers, graduates and apprentices as we over-proportionally invest in new products and technologies.
“We also remain committed to our UK plants in which we have invested more than £4bn since 2010 to future-proof manufacturing technologies to deliver new models.”
Production will be cut at the Castle Bromwich and Solihull sites, with affected staff based at Solihull.
Jaguar Land Rover would not confirm the number of jobs to be lost but said the changes would largely see agency staff not having their contracts renewed. A source told the Reuters news agency that 1,000 roles would be cut.
There are 3,200 people employed at the Castle Bromwich site and a further 10,000 at Solihull.
Some staff roles will also be moved from Castle Bromwich to Solihull.
Speaking to Sky’s Ian King in March, chief executive Ralf Speth had said: “The economy is weaker in the UK than in any other European country but it’s also quite clear that the diesel discussion, additional taxes on the latest technology have created a reaction in the consumer base.”
In January, the firm had said it would temporarily reduce production at its other British plant of Halewood this year in response to weakening demand due to Brexit and tax hikes on diesel cars.
When asked in March if there could be further production cuts at the carmaker’s UK plants, Mr Speth told Ian King: “It’s quite clear that if there’s no demand, then we have to adapt our production levels.
“It’s unfortunate that in the UK demand is not there anymore, and the UK is our home market.
“So in our home market, it’s important that the economy can grow and that we have free opportunity to sell our cars.”
Jaguar sales have fallen 26% so far this year and Land Rover dropped 20%.
Julian Knight, MP for Solihull, said: “The news that has come to us is disturbing, and I am in regular contact with JLR on this issue.
“More generally, I think it is a mistake for the green lobby to propose measures against diesel vehicles which are often less polluting than other vehicles, and where there are relatively easy fixes in place in order to reduce emissions.
“The demonization of diesel is now having very real consequences for the UK car industry, which is key to Britain’s growth.”