- Thursday, April 18, 2024
By: Eastern Eye Staff
INDIA’s Tata Motors on Monday (15) reported a loss of £1.14 billion for the first three months of this year as sales in its key markets of China and Europe were hit by the coronavirus pandemic.
The Mumbai-headquartered firm had just returned to the black in the previous quarter amid Chinese demand for its British luxury brands Jaguar and Land Rover.
The Rs 98.94 billion rupees (about £ 1 billion) net loss for the January-March quarter followed a net profit of Rs 11.17 billion for the same period last year.
JLR reported a pre-tax loss of £501 million in its final quarter to the end of March.
“The auto industry faced strong headwinds in FY20 amidst a slowing economy due to multiple factors… all leading to weak consumer sentiments and subdued demand across segments,” Tata Motors chief executive Guenter Butschek said in a statement.
“Disruption in the supply chain induced by the pandemic and the nationwide lockdown in mid-March 2020 added to the problems.”
The company forecast a weak April-June — the first quarter of the 2021 financial year — which coincided with widespread virus lockdowns across its Europe, UK and Chinese markets.
But it expects a gradual recovery of sales and improved cash flows for rest of the financial year.
Shares of Tata Motors closed almost 5 per cent lower on the Bombay Stock Exchange Sensex Index ahead of the earnings result.
In the UK, JLR will slash up to 1,100 temporary jobs as part of its cost-cutting efforts.
Last year, the company had announced plans to gradually axe 5,000 jobs, with a target of saving £1 billion by 2021.
The pruning will be implemented at JLR factories in Halewood, Merseyside, and Solihull and Castle Bromwich in the West Midlands.
“Through its ongoing transformation programme, Jaguar Land Rover is taking action to optimise performance and achieve further operational efficiencies to enable sustainable growth and safeguard the long-term success of our business,” the company said in a statement.
“Against the backdrop of the Covid-19 pandemic, the company has taken the difficult decision to reduce the number of contract-agency employees in its manufacturing plants over the coming months.”
Trade union Unite’s national officer Des Quinn said the decision was “another devastating blow for our auto sector and the communities that rely on them for jobs”.
“We urge the government to get on with delivering the urgently needed sector support package, as other countries such as France and Germany have done, so that we can stem the tide of redundancies,” he added.
