Jaguar Land Rover owner records $4 billion loss, driving share price down
Tata Motors shocked investors after revealing the largest quarterly loss in Indian corporate history, with the owner of Jaguar Land Rover losing around $4 billion following a major dip in Chinese sales.
Jaguar Land Rover (JLR) owner Tata Motors has posted a $4 billon loss due to a slump in Chinese demand that has hurt sales and sent its share price tumbling as much as 30%.
Following the news, Tata Motors issued a warning that its JLR unit, will also suffer an operating loss in the year to March, a downgrade on its earlier forecast for the business which predicted that it would manage to breakeven.
‘We are now taking clear and decisive actions in JLR to step up its competitiveness, reduce costs and improve cash flows and make the business fit for the future,’ CFO PB Balaji told reporters on a conference call on Thursday.
Tata Motors hurt by weaker China demand
A slump is Chinese demand is hitting JLR’s sales hard, with consumer interest in the luxury carmaker’s vehicles halving n the December quarter adding to the signs that China’s economy is beginning to slowdown.
Not only is JLR having to contend with weaker demand from China, but the carmaker is having to contend with ongoing Brexit uncertainty and low demand for its diesel cars which it relies on for the bulk of its sales in the European market.
JLR acts to stop further losses
In an effort to mitigate to impact of weaker demand in China, JLR is focusing on generating profits for its car dealers, with the company looking to incentivise retail sales over wholesale, Balaji told reporters.
‘We are encouraged by continued demand for the refreshed Range Rover and Range Rover Sport,’ JLR Chief Commercial Officer Felix Brautigam said in a statement.
‘With deliveries of the new Evoque due to start later this quarter, we look forward to building momentum,’ he added.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. Please see important Research Disclaimer.
Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
See an opportunity to trade?
Go long or short on more than 13,000 markets with IG.
Trade CFDs on our award-winning platform, with low spreads on indices, shares, commodities and more.
Live prices on most popular markets
- Forex
- Shares
- Indices
See more forex live prices
See more shares live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
See more indices live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.
