Jaguar Land Rover reported a fall in profit in its latest quarter after flooding at a key aluminum supplier hit deliveries of its luxury SUVs.
The British maker of Range Rover and Land Rover vehicles said on Nov. 8 that pretax profit dropped 10 percent to 398 million pounds ($516 million) in the three months through September from a year earlier. Revenue fell 5.6 percent to 6.5 billion pounds.
The company blamed the drop in deliveries on continued aluminum supply constraints caused by flooding at a mill in Switzerland.
The aluminum shortage has been an additional headache for European carmakers already grappling with a downturn in demand. It’s also affected rivals such as Porsche and Mercedes-Benz Group that use the same supplier for parts.
JLR said it expects production to pick up in the final six months of its financial year as the aluminum supply problems ease, and stuck to its full-year revenue guidance of about 30 billion pounds and an EBIT margin of 8.5 percent.
JLR parent Tata Motors sees profits drop as Indian market slows
The shortage also took its toll on JLR’s Indian parent Tata Motors, which saw net income fall 11 percent in the quarter to 33.4 billion rupees ($396 million). Revenue dipped 3.9 percent to 1.01 trillion rupees, a slightly steeper decline than analysts expected.
JLR is by far the largest division of Tata Motors, making up more than two-thirds of the group’s revenue in the period. Ratan Tata, the chairman of Tata Group who led the purchase of Jaguar and Land Rover from Ford, died last month at age 86.
Tata Motors’ results come amid an overall slowdown in Indian consumption, with high inflation and moderating growth visible in many pockets of the economy. The country’s biggest carmaker, Maruti Suzuki, last week flagged slowing sales for its entry-level cars after quarterly earnings missed estimates.
Tata Motors remains cautious on demand in India but expects the festive season to provide a boost, it said in a statement.
Tata Motors’ passenger vehicle sales rose 30.5 percent in October from a year earlier, according to data from India’s auto dealers body. The festival season is crucial for four- and two-wheeler makers, as it contributes as much as 30-35 percent of annual sales, the industry body said.
Source: Automotive News, November 8, 2024