A poor show by Jaguar Land Rover (JLR) pulled Tata Motors into the red for the first time in three years. The Indian automaker posted a loss of £186.3 million in the June quarter of fiscal 2019 as opposed to a profit of £320 million in the year ago period. The figures surprised analysts as they had predicted a profit of £92 million.
JLR reported a loss of 210 million pounds as it sold fewer vehicles in its biggest market China due to changes in import duties, as well as in its European market over diesel concerns. In China, dealers had delayed purchases of JLR vehicles to take benefit of the reduction of import duties from 25% to 10% that came into effect after the end of the reporting quarter, that is July 1. In other markets including Europe, JLR had taken a planned dealer stock reduction as it faced uncertainty over diesels along with Brexit and additional diesel taxes in the UK.
All these factors also resulted in a 7% fall in JLR’s quarterly revenues to 5.2 billion pounds. JLR contributes nearly 90% to Tata Motors’ revenues. The Indian company reported revenues of £6,71 billion during the period under review
JLR hopes earnings will improve in the remaining period of the financial year driven by new models, especially its recently launched electric Jaguar I-Pace, and the lower import duties in China.