Automobile

Jaguar Land Rover owner Tata Motors reports quarterly loss on chip shortages

Raw material costs for Tata Motors jumped to 373.1 billion rupees in the latest quarter compared to 99.4 billion rupees in the same period last year.

“JLR now expects semiconductor supply shortages in the second quarter to be greater than in the first quarter, potentially resulting in wholesale volumes about 50 percent lower than planned,” Tata said in a statement. “In the second quarter, JLR expects a negative EBIT margin with a free cash outflow of less than £1 billion. JLR expects the situation will start to improve in the second half of the financial year.”

Earlier this month, Jaguar Land Rover warned deliveries in the second quarter will be 50 percent worse than anticipated as a global chip shortage shows no sign of abating.

The chip crisis forced the luxury automaker to temporarily suspend production at its Castle Bromwich and Halewood plants.

Jaguar Land Rover’s performance is crucial for Mumbai-based conglomerate Tata Group, after a devastating wave of COVID-19 infections and government-imposed lockdowns crimped demand in its home market.

Jaguar Land Rover is working with suppliers and chip manufacturers to increase the visibility and the control of chip supply for its vehicles, CFO Adrian Mardell said in an investor call earlier this month. It’s also prioritizing production of higher-margin vehicles and looking to change features on vehicles. That said, the automaker is not expecting the chip shortage to delay any “significant” launches, Mardell said.

Under CEO Thierry Bollore, the former Renault chief who joined the UK automaker in September, Jaguar Land Rover is also planning to electrify its lineup and ditch combustion engines completely in four years, a move that will necessarily mean a higher reliance on more advanced semiconductors.

Land Rover line will get its first full-electric model in 2024, and by the following year, all Jaguars will be entirely powered by batteries.

Most Related Links :
reporterwings Governmental News Finance News

Source link

Back to top button