Jaguar Land Rover Decline Brings Down Income for Tata Motors

Feb 05, 2015 10:38 AM EST | Jordan Ecarma

Falling sales at Jaguar Land Rover dragged down profit for Tata Motors as net income fell from 48 billion rupees to 35.8 billion rupees, or $580 million, year over year for the latest quarter.

The luxury unit of India's biggest carmaker took sales hits in both North America and India, Bloomberg Business reported.

The net income figure posted puts Jaguar Land Rover below 34 analysts' estimates compiled by Bloomberg that had a median of 49.6 billion rupees. JLR profit fell from roughly $947 million to around $907 million year over year.

But it's not all bad news. Analysts say that JLR's new China plant is likely to increase output and will help boost deliveries along with new upcoming models.

"The key reasons for JLR's slow sales in recent months have been supply driven and planned actions rather than any demand issues," wrote Ashvin Shetty and Ritu Modi, analysts at Ambit Capital Pvt., according to Bloomberg.

Revenue for Tata Motors increased to 699.7 billion rupees from 638.5 billion rupees.

A new facility in the United States could be the next step for Tata Motors' luxury unit. Jaguar Land Rover executives reportedly met with Georgia Gov. Nathan Deal last month to discuss a potential new plant in the southern part of the state.

The UK's Sunday Times reported in October that Jaguar Land Rover was in talks with several states in the South for a factory that would build around 200,000 vehicles a year. Establishing an American facility would let Jaguar Land Rover avoid tariffs on imports while mitigating the effects of changing currency rates.

Last year, the British automaker opened a new factory in China, while a plant in Brazil is slated to open in 2016.

© 2017 Auto World News, All rights reserved. Do not reproduce without permission.
Get the Most Popular Autoworld Stories in a Weekly Newsletter

Join the Conversation

Real Time Analytics