Business

Tata Motors Worst Quarter Performance Since December 2009

JAVED SAIFI | 0
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| August 1 , 2018 , 12:30 IST

Tata Motors riding on growth for last three years has recorded a net loss of Rs 1,862 crore on Tuesday in the first quarter ended April-June.

It is the worst quarterly loss for the company since December 2009.

The reason Tata Motors has recorded a net loss after three years is the decline in sales of its UK subsidiary Jaguar Land Rover to dealerships in China and the high cost of raw materials.

Dealers in China have delayed purchases to benefit themselves with the import duty cut that leads to a 6.7 percent drop in quarterly revenue for JLR.

Though, Tata Motors consolidated net sales rose by 14 percent to Rs 67,081 crores for the first quarter as compared to Rs 59,818.22 crores from the previous year from its domestic business in the country.

Also Read: Tata Motors Cars Just Got Cheaper, By Up To Rs 2 Lakhs!

Commenting on the performance, Natarajan Chandrasekaran, Chairman of Tata Motors said, “I am delighted with the progress made by the domestic business on their ‘Turnaround 2.0’ strategy. We continue to gain market share while strongly improving profitability in both Commercial Vehicles and Passenger Vehicles.”

On the JLR front, Chandrasekaran said, “We have faced multiple challenges including temporary issues like China duty impact as well as the market issues like diesel concerns in UK and Europe.”

But despite all the challenges, Chandrasekaran assured to be committed to deliver the planned margins as outlined earlier this year and appreciate the urgency to address upcoming challenges with speed.

Tata Motors will cut 1,000 jobs at two of its English factories in the UK and Europe due to a fall in sales of JLR. 

Company’s total expenses during the first quarter rose by 17 percent to Rs 69,890 crores and EBITDA dropped 50 basis points to 7.5 percent.

Tata Motors has recorded a net profit of Rs 3,199 crore for the first quarter during the same period last year.