Jaguar Land Rover Bleeds $4.4 Billion In 4th Quarter Over Trade Tensions

Jaguar Land Rover Bleeds $4.4 Billion In 4th Quarter Over Trade Tensions

The management continues to focus on cost control measures to arrest the fall in EBITDA margin.

However, on the standalone basis, the company reported healthy quarterly numbers.

Considering the ideal storm of woes engulfing JLR at the moment - from the damning of diesel to a slow down in China, from a loss of love for saloon cars to Brexit confusions - performance in the last quarter could have been a lot worse, with sales of £6.2bn down from £6.3bn and numbers down from 154k to 144k.

The firm said "significant market, technological and regulatory headwinds" were affecting the sector, while investment in new models and changing technology was still high.

Dr Ralf Speth, JLR chief executive, said: "Jaguar Land Rover reported strong third quarter sales in the United Kingdom and North America, but our overall performance continued to be impacted by challenging market conditions in China". Quarterly revenue stood at GBP 6.22 billion, versus GBP 6.31 billion.

JLR, which has its engine manufacturing centre at the i54 to the north of Wolverhampton, and auto plants at Solihull, Castle Bromwich and Halewood in Merseyside, reported a £273 million pre-tax loss for the last three months of 2018.

"Tata Motors domestic business continues the strong momentum and has delivered market share gains as well as profitable growth".

Tata Motors had posted a net profit of Rs1,214.60 crore in the year-ago quarter.

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This led JLR to post a 6 percent year-on-year (YoY) decline in its retail volume.

"Despite this, sales saw a dip in January due to lower demand for the F-PACE and the XF in China".

One problem, according to the presentation, is JLR's dealer network.

Plummeting sales in China are compounding Jaguar Land Rover's challenges that include the industry's shift away from vehicles powered by gasoline and diesel - a stronghold for the company. Big asset impairment dragged Tata Motors into consolidate loss.

Total sales tallied at 144,602 vehicles, down from 154,447 during the same period in 2017.

Kotak Institutional Equities has also maintained a "buy" rating on Tata Motors.

"We see a gradual improvement in China going forward". The brokerage downgraded the stock to "Neutral", with a target price of Rs 166.

"JLR's margin level is likely to be marginally negative during FY19". U.S. sales rose 20 per cent and 18 per cent in the UK. But the stock recovered some what and was trading at Rs 150.95, still down more than 17 per cent in late trading.