Tata Motors shares plunge most in 26 years after record loss

Lloyd Doyle
February 8, 2019

The US remained the largest market for the two brands, with retail sales of almost 40,000 units, a growth of 21 percent in January. Jaguar chief executive Ralf Speth said: "Jaguar Land Rover reported strong third-quarter sales in the United Kingdom and North America, but our overall performance continued to be impacted by challenging market conditions in China".

Jaguar Land Rover booked a loss for the last three months of 2018 as sales collapsed in China.

The Tata Motors share closed marginally higher today after credit ratings agency Fitch Ratings said it has placed the credit rating of the Tata Group firm on negative watch, stating increasing risks for its British luxury vehicle unit - Jaguar Land Rover (JLR) - over a potentially chaotic Brexit.

In JLR, the market conditions continue to be challenging particularly in China, Chandrasekaran said.

The automotive industry is facing significant market, technological, and regulatory headwinds.


Uncertainty over China and with the possibility of a hard Brexit looming large, Tata Motors on February 7 said it is revising its pre-tax margin guidance to 3-6 percent in FY20 from 4-7 percent announced six months back.

Commenting on the step, JLR Chief Executive Ralf Speth said, "We are announcing a non-cash exceptional charge to reduce the book value of our capitalised investments".

Jaguar Land Rover says half of the exceptional charge was due to an accounting acknowledgement that investments in machinery and plants were worth less than previous calculations suggested. 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.

Ralf Speth, JLR's chief executive, said: "Jaguar Land Rover reported strong third-quarter sales in the United Kingdom and North America but our overall performance continued to be impacted by challenging market conditions in China".

JLR realised £500m of cash improvements through the "Charge" programme in the third quarter. They had already slumped more than 50 per cent in the past 12 months through Thursday on concerns about Jaguar Land Rovers waning sales, profitability, high capital-expenditure need and the impact of Brexit. The company also had a £1.9bn undrawn credit facility available at the end of the quarter. "With these interventions, we are building Tata Motors group to deliver strong results in the medium term", he added.

Other reports by Iphone Fresh

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