JLR, Britain's biggest carmaker, is set to announce "substantial" job cuts in the thousands, a source told Reuters, as the company faces double-digit drops in demand in China and a slump in sales for diesel cars in Europe.

"JLR have been very clear that they regard the UK as home and are investing in the future to develop the next generation of vehicles. We will continue to work closely with the company to support their long-term plans," the spokesman said, noting that there had been no official announcement on job cuts yet.

(Reporting by William James, Writing by Kylie MacLellan; editing by Stephen Addison)