JLR bites, Tata Motors net loss hits `26,961 cr

Hit by one-time asset impairment in its British arm Jaguar Land Rover (JLR), Tata Motors reported a massive net loss of

`26,960.8 crore for the third quarter ended December 31, 2018.

The company has posted a net profit of

`1,214.6 crore, was hurt by the US-China trade war, low demand for diesel cars in Europe and Brexit worries.

JLR, that contributes nearly 72 per cent to Tata Motors’ revenue, had a bumpy the past year as sales fell on account of slowing business in its key market China. The luxury carmaker also shut down one of its plants in October to cope with the weakening demand. Meanwhile, Tata Motors’ total revenue from operations rose 4.36 per cent to `77,582.71 crore as compared to

`74,337.7 crore, the company said.

On a standalone basis, the company posted profit after tax of `617.62 crore as against `211.59 crore.

Total standalone income rose to

`16,477.07 crore as against `16,186.15 crore.

JLR’s revenue, however, declined 1 per cent to 6.2 billion pounds. “Given the muted demand scenario and the associated impact on the financials, JLR has concluded that the carrying value of capitalised investments should be adjusted down, resulting in a non-cash £3.1 billion pre-tax exceptional charge and an overall pre-tax loss of

£3.4 billion for the quarter,” Tata Motors said.

Commenting on the step, JLR CEO Ralf Speth said, “We are announcing a noncash exceptional charge to reduce the book value of our capitalised investments”.

“The automotive industry is facing significant market, technological, and regulatory headwinds. At the same time, investment in new models, electrification and other technologies remains high”, he added.