Jaguar Land Rover posts quarterly loss and takes £3.1bn hit

JLR factory

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Speaking with CarAdvice in October a year ago, Jaguar Land Rover CEO Ralf Speth said the production slowdown was caused by something of a ideal storm. It added that the investment in new models and technology remains high this year because of the weak sales, that sharply contrasts with the expectations that the British vehicle maker would break even.

Tata Motors' overseas woes have finally come home to roost, and how! Domestic revenue at Rs16,208 crore for the quarter was up 1.5 per cent, it said, adding that its market shares for CVs was up 60 bps compared to FY 18 while sales of personal vehicles were up 50bps.

Tata Motors expects the costs from Jaguar Land Rover's voluntary redundancy programme to be recognised in the March quarter.

On a stand alone basis, Tata Motors reported a net profit of Rs 618 crore on 1.5% growth in revenues to Rs 16,208 crore.

"The economic slowdown in China continues to impact consumer confidence but, as part of our turnaround plan, we are working extensively with our retailers to rejuvenate sales".

JLR has reduced its EBIT (earnings before interest, taxes) guidance to marginally negative from breakeven and EBIT margin guidance over fiscal year 2020-2022 has been revised downwards to 3-6 per cent, versus earlier 4-7 per cent. "We are taking the right decisions now to prepare the company for the new technologies and strong product offensive for the future", JLR's chief executive Ralf Speth said.

'With deliveries of the new Evoque due to start later this quarter, we look forward to building momentum, ' he added.

It announced yesterday a net loss of 270 billion rupees (US$3.8 billion) for the quarter ending December owing to a US$3.9-billion write-down on JLR.

Plummeting sales in China are compounding Jaguar Land Rover's challenges that include the industry's shift away from vehicles powered by petrol and diesel - a stronghold for the company.

Tata Motors has bitten the bullet. Despite the muted growth, Tata Motors has delivered strong results, registered an impressive profitable growth this year on the back of exciting products, renewed brand positioning and aggressive cost reduction.

The company is in track with investment in electrification with Electric Drive Units to be produced at the Engine Manufacturing Centre and a new Battery Assembly Centre to be established in the United Kingdom, it added. "For Jaguar Land Rover, it will be catastrophic if Britain goes for a no-deal Brexit".

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