Jaguar Land Rover announces $A6.2 billion loss

Jaguar Land Rover announces $A6.2 billion loss

JLR's Chinese sales, which account for roughly one-in-seven of its global sales, fell 40 per cent year-on-year, which offset growth in the United States and British markets.

Mumbai: Tata Motors said on Thursday that its profit after tax of Rs 26,961 crore during October to December 2018 was impacted by an exceptional item of asset impairment in Jaguar Land Rover of 3.1 billion pounds (about Rs 27,838 crore).

"Today, we are also announcing a non-cash exceptional charge to reduce the book value of our capitalised investments".

Shares in India's Tata Motors tanked nearly 30 per cent today after problems at its Jaguar Land Rover unit dragged the luxury carmaker to India's biggest quarterly loss.

Last month Jaguar Land Rover joined Honda and Toyota in announcing a post-Brexit temporary plant shutdown, which will affect all three of its United Kingdom vehicle factories, as well as its engine plant in Wolverhampton.

"We continue to work closely with Chinese retailers to respond to current market conditions". Its heavy production presence in the United Kingdom exposes it to a disorderly Brexit, the likelihood of which has risen over the past few weeks, Fitch Ratings said this week.

"Jaguar Land Rover is facing headwinds on multiple fronts, including geopolitical uncertainty and technological disruption, apart from a sluggish demand scenario in a strong market like China", said analyst Debjit Maji at Stewart & Mackertich Wealth Management in Kolkata.

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The British luxury auto unit has been hit by slow sales in China, one of its largest markets, and in Europe, where customers are moving away from diesel to more fuel efficient vehicles.

"Economic outlook in China remains bleak. 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".

Logos of the carmakers Jaguar and Land Rover are pictured during the first media day of the 78th Geneva Car Show at the Palexpo in Geneva March 4, 2008.

Credit-default swaps protecting Jaguar Land Rover's debt against non-payment using five-year contracts surged to record high 813 basis points on Wednesday.

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.

As part of the plans, JLR last month announced investments worth hundreds of millions of pounds to produce electric drive units at Wolverhampton.

This is a hard time for the industry, but we remain focused on ensuring sustainable and profitable growth, and making targeted investments, that will secure our business in the future.

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