Jaguar Land Rover slumps to £3.6bn loss amid Chinese sales slide

Jaguar Land Rover slumps to £3.6bn loss amid Chinese sales slide

Jaguar Land Rover slumps to £3.6bn loss amid Chinese sales slide

Jaguar Land Rover has reported a £3.6 billion (RM19.2 billion) loss for 2018, the largest in its history.

Tata Motors Group has reported a lower consolidated net profit of ₹1,109 crore for the fourth quarter ended March 31, 2019 compared to a net profit of ₹2,175 crore in the same period past year.

The auto manufacturer, which has already announced thousands of job cuts in the United Kingdom in the first months of 2019, made the loss after a £400m profit in 2018.

Full-year revenues fell 5.6 per cent to £7.1 billion, as growth in the U.S. and United Kingdom was offset by "weaker Chinese market conditions". Sales in that market dipped by 5.8% year-on-year to 578,915 units, offsetting gains made in the United Kingdom and U.S. markets, where sales rose by 8.4% and 8.1% respectively. The firm noted that it retained £3.8 billion of cash.

"In JLR, we continue to face challenges in China which we are addressing on priority", Tata Motors chairman N. Chandrasekaran said. The company gave a subdued near-term outlook.

The Tata Group company said it saw "encouraging" demand for its new models over the past year, including the Jaguar E-PACE sporty compact SUV, the Range Rover Velar mid-size SUV, the refreshed Range Rover and Range Rover Sport (both including plug-in hybrid options) and the all-electric Jaguar I-PACE. Meanwhile, US giant Ford is expected to cut as many as 550 jobs from its United Kingdom operations in the coming weeks.

The decline in profit was mainly a result of lower revenues and exceptional charge on account of its British arm Jaguar Land Rover. The brokerage said that the JLR outlook remains weak while Indian business value has cyclically peaked given an impending truck downcycle.

"The company has already delivered the first £1.25 billion, with £150 million of cost efficiencies, £400 million of working capital improvements and £700 million of investment savings achieved by March 2019". JLR wants to be a leaner and fitter company going forward, benefiting from the investments made in new products and technologies that will drive future demand.

Without the one-off write-down, Jaguar Land Rover's annual pre-tax loss was £358 million.

He added: "We are taking concerted action to reduce complexity and to transform our business through cost and cash flow improvements".

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