Jaguar Land Rover witnesses record £3.6bn annual loss

BRITISH car-maker, Jaguar Land Rover (JLR) witnessed its biggest ever loss in the history last year after it recorded £3.6 billion loss.

Tata Motors-owned firm blamed weak Chinese demand and a fall in diesel vehicle sales for its poor performance.

Indian conglomerate controlled company said it returned to profitability with a fourth quarter pre-tax profit of £120 million before exceptional items.

JLR invested £3.8bn in product development, new technologies, expanding manufacturing footprint, and streamlining product creation process last year.

Continued weak demand from China, however, led to a 5.8 per cent decline year-on-year in retail sales to 578,915 vehicles last year.

In the last quarter of the financial year, JLR returned to profitability. In the three months to 31 March, the company generated pre-tax profits of £269m before exceptional items as the ‘Charge’ transformation programme delivered cost and cash improvements, the company said.

After £149m of redundancy costs as part of the ongoing transformation, pre-tax profit was £120m.

Revenues of £7.1bn were down £421m year-on-year as growing demand in key markets such as the UK and US helped offset weaker China market conditions.

JLR chief executive Prof Dr Ralf Speth said: “Jaguar Land Rover is focused on the future as we overcome the structural and cyclical issues that impacted our results in the past financial year.

“We will go forward as a transformed company that is leaner and fitter, building on the sustained investment of recent years in new products and the autonomous, connected, electric and shared technologies that will drive future demand.”

JLR continues to maintain a strong balance sheet with £3.8bn of cash and an available £1.9bn undrawn credit facility, resulting in £5.7bn of total liquidity at the financial year-end, the UK’s biggest car producer said.

JLR is on track to make at least £2.5bn of investment, working capital and profit improvements by March 2020 through its charge transformation programme.