- Jaguar Land Rover blamed the drop in deliveries on continued aluminum supply constraints caused by flooding at a mill in Switzerland.
Jaguar Land Rover reported a fall in profit in its latest quarter after flooding at a key aluminum supplier hit deliveries of its luxury SUVs.
The British maker of Range Rover and Land Rover vehicles said Friday that pretax profit dropped 10 per cent to £398 million ($516 million) in the three months through September from a year earlier. Revenue fell 5.6 per cent to £6.5 billion.
The company blamed the drop in deliveries on continued aluminum supply constraints caused by flooding at a mill in Switzerland.
The aluminum shortage has been an additional headache for European carmakers already grappling with a downturn in demand. It’s also affected rivals such as Porsche AG and Mercedes-Benz Group AG which use the same supplier for parts.
JLR said it expects production to pick up in the final six months of its financial year as the aluminum supply problems ease and stuck to its full-year revenue guidance of about £30 billion.
The shortage also took its toll on JLR’s Indian parent Tata Motors Ltd., which saw net income fall 11 per cent in the quarter to 33.4 billion rupees ($396 million). Revenue dipped 3.9 per cent to 1.01 trillion rupees, a slightly steeper decline than analysts expected.
JLR is by far the largest division of Tata Motors, making up more than two-thirds of the group’s revenue in the period.
underwhelming
Tata Motors’ results come amid an overall slowdown in Indian consumption, with high inflation and moderating growth visible in many pockets of the economy. The country’s biggest carmaker Maruti Suzuki India Ltd. Last week flagged slowing sales for its entry-level cars after quarterly earnings missed estimates.
Tata Motors remains cautious on demand in India but expects the festive season to provide a boost, it said in a statement.
Tata Motors’ passenger vehicle sales rose 30.5 percent in October from a year earlier, according to data from India’s auto dealers body. The festival season is crucial for four- and two-wheeler makers, as it contributes as much as 30-35 per cent of annual sales, the industry body said.
Tata Motors shares have dropped 1.5 per cent this quarter, compared with a 7.5 per cent rise by the Nifty index. The stock has climbed 3.6 per cent this year.
The automaker launched Curvv in August — a crossover between a sport utility vehicle and a coupe — and the compressed natural gas-fueled version of its best-selling car Nexon in September. Tata Motors expects these new models to drive sales in the coming months.
Get insights into Upcoming Cars In India, Electric Vehicles, Upcoming Bikes in India and cutting-edge technology transforming the automotive landscape.
First Published Date: 10 Nov 2024, 10:13 AM IST
Leave a Reply