Jaguar Land Rover (JLR) parent Tata Motors reported a 96% collapse in net profit for its third quarter, following sharply lower earnings at British luxury carmaker JLR and losses in its embattled main operation in India.
Consolidated net profit for the three months to the end of December fell to 1.12 billion rupees (€15.8m) from 29.53 billion rupees (€417m) a year earlier. Total income from operations fell 4.3% to 685.41 billion rupees (€9.7 billion).
JLR remains financially strong, but its results fluctuate due to product cycles and an over-reliance on China. Furthermore, its sales in the US, which account for 25% globally, are considered vulnerable due to Donald Trump’s protectionist policies.
The Jaguar brand performed incredibly well, with sales rising 90% to 45,364 vehicles, but Land Rover sales fell 9% to 103,924 vehicles as demand declined for the outgoing Discovery, which strong Discovery Sport sales failed to cover. Fortunes will improve in the fourth quarter with the launch of the next Discovery. Jaguar’s success was pinned by the continued growth of the F-PACE, strong sales of the Jaguar XF and increased demand for the long wheelbase XFL in China.
JLR is keeping the entire giant parent company afloat, with Tata Motors’ core domestic business in crisis. Its share of the Indian market has collapsed from 16% to less than 6%. This led to contention between chairman Cyrus Mistry and his predecessor Ratan Tata, and Mistry’s ousting from what is India’s biggest conglomerate last October. In 2009, Mr Tata launched the world’s cheapest car, the Nano, which has been a commercial flop, selling just 9054 units last year. Sources say Tata’s board recommended last year that the Nano be abandoned.
Meanwhile, JLR continues to innovate, with Jaguar drivers now able to use their car’s touchscreen to pay for fuel, in a new cashless app that is the world’s first in-car payment system. Rather than use a card at a pump or queue in the forecourt shop, owners who install the Shell app can simply drive up to any Shell service station and use their car’s touchscreen to select how much fuel they require and pay using PayPal or Apple Pay, with Android Pay launching later in 2017. Currently the service is available in the UK, with a global launch planned. The feature is currently available on the Jaguar XE, XF and F-PACE, but will be launched across the entire Jaguar and Land Rover ranges. Other future tech innovations include cashless payment for parking and drive-through restaurants as well as the introduction of gesture technologies such as a sweep of the foot opening the boot.
Head of Connected Technologies and Apps Peter Virk said: ‘In a world where cash is no longer king, customers are increasingly using electronic payments and contactless cards. Making a payment directly from a car’s touchscreen will make refuelling quicker and easier. With this new system you can choose any pump on the forecourt and pay for the fuel even if you’ve forgotten your wallet or can’t find your credit or debit card. You will save time because there’s no more queuing to pay in a shop, and for drivers with children, it won’t be necessary to wake them up, or unstrap them from their seats to take them into the shop. Expenses and tax returns will also be made much simpler, with no receipts to lose as these will all be sent electronically.’
Our regular automotive industry News & Insights are no longer being published on the Autovista Group Market Reports website.
Instead, you can now find the latest updates at our central Autovista Group website, home to our pan-European brands including Autovista, Eurotax, Glass's and Schwacke.
To stay up to date with rapidly changing market trends, we recommend signing up to our free Autovista Group Daily Brief which delivers our daily news stories directly to your inbox.
You can still find our in depth market reports here on the Autovista Group Market Reports site. Keep checking back as we have an exciting new report due to be launched shortly!