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Tata Motors posts Rs 1,863 crore loss in Q1, first in three years

Tata Motors CEO and MD Guenter Butschek said there could be a few challenges in the short term particularly in commercial vehicles as the new regulations on axle loads come into effect.

Mail Today Bureau        Last Updated: August 1, 2018  | 09:59 IST
Tata Motors posts Rs 1,863 crore loss in Q1, first in three years

India's Tata Motors Ltd reported its first quarterly loss in nearly three years on Tuesday, as its UK subsidiary Jaguar Land Rover sold fewer of its luxury cars to dealerships in China, while raw material costs rose. The automaker said its first-quarter net loss was Rs 1,862 crore, compared with a profit of Rs 3,182 crore a year earlier that included a Rs 3,609 crore gain from changes to the way JLR's pension payments are calculated.

Dealers in China delayed purchases to benefit from an import duty cut that came into effect after the end of the reporting quarter, the automaker said, adding that planned dealer stock reduction in other markets also weighed on its business. That resulted in a 6.7 per cent drop in quarterly revenue for JLR, the company added.

Total consolidated revenue from operations, however, rose to Rs 67,081.29 crore as compared with Rs 59,818.22 crore in the year ago period, Tata Motors said in a regulatory filing.

Total expenses during April-June rose about 17 per cent to Rs 69,890 crore.

JLR had said in April it would cut around 1,000 jobs and production at two of its English factories due to a fall in sales caused by uncertainty around Brexit and confusion over diesel policy in UK and Europe.

On a standalone basis, Tata Motors reported a net profit of Rs 1,187.65 crore. It had reported a net loss of Rs 463.14 crore in the first quarter last fiscal. Standalone total revenue from operations grew to Rs 16,803.11 crore during the quarter compared to Rs 10,366.19 crore in the same period of 2017-18.

Standalone volume rose 59 per cent to 1,76,868 units driven by robust sales of commercial and passenger vehicles in the Indian market.

Commenting on the domestic business, Tata Group Chairman Natarajan Chandrasekaran said the company continues to gain market share, while strongly improving profitability in both commercial vehicles and passenger vehicles.

"With regards to JLR, we faced multiple challenges, including temporary issues like China duty impact as well as the market issues like diesel concerns in the UK and Europe, he added. Despite these challenges, the company remains committed to delivering the plan it outlined earlier this year," Chandrasekaran said.

Tata Motors CEO and MD Guenter Butschek said there could be a few challenges in the short term particularly in commercial vehicles as the new regulations on axle loads come into effect. "But, we remain positive on the long term potential of the Indian market and I am confident that Tata Motors is taking the right steps to drive competitive, consistent, cash accretive growth," he added.

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