Austerity mode at JLR
Only bad news on Tata’s Jaguar/Land Rover unit: a pre-tax loss of over GBP 3 billion, challenges in the Chinese market, 6.4% fall in retail sales, decline in demand for Diesel vehicles, a model range that confuses consumers and that seems to be packed with vehicles that are too similar, lack of fuel economic and emission neutral vehicles…
End of the good days
Tata has been riding a successful JLR wave for a couple years, in better years benefiting from up to 90% of its operating profit and 50% of the company’s revenue coming from the British automaker. This has come to an end now. JLR is cutting costs, and doing it drastically: in the next 18 months, it will fire 10% of its workforce and aim to improve cash flow by GBP 2.5 billion.
Awaiting brighter horizons, Tata’s credit rating is placed on negative watch.
Tata India
The Tata car and truck brand is doing better in its home country, where revenues are growing after an austerity strategy, executed in 2018, which seems to have become the company’s blueprint for JLR. The Indian business reported, for 2018 Q4, a threefold jump in profit, to INR 6.18 billion. The Indian consumer is slowly moving away from the small-vehicle segment into compact and medium sized, and is developing a strong taste for SUV, of which Tata has plentiful in its model range.
What about JLR?
Regardless of good results at home, Tata needs to face the music for JLR. It seems like there are too many battles to fight at the same time: sales in key markets (China), evolution of model range, lack of investment in electric, competition from new brands, new business models,… all of this in a context of staff downsizing and austerity.Only bad news on Tata’s Jaguar/Land Rover unit: a pre-tax loss of over GBP 3 billion, challenges in the Chinese market, 6.4% fall in retail sales, decline in demand for Diesel vehicles, a model range that confuses consumers and that seems to be packed with vehicles that are too similar, lack of fuel economic and emission neutral vehicles…
End of the good days
Tata has been riding a successful JLR wave for a couple years, in better years benefiting from up to 90% of its operating profit and 50% of the company’s revenue coming from the British automaker. This has come to an end now. JLR is cutting costs, and doing it drastically: in the next 18 months, it will fire 10% of its workforce and aim to improve cash flow by GBP 2.5 billion.
Awaiting brighter horizons, Tata’s credit rating is placed on negative watch.
Tata India
The Tata car and truck brand is doing better in its home country, where revenues are growing after an austerity strategy, executed in 2018, which seems to have become the company’s blueprint for JLR. The Indian business reported, for 2018 Q4, a threefold jump in profit, to INR 6.18 billion. The Indian consumer is slowly moving away from the small-vehicle segment into compact and medium sized, and is developing a strong taste for SUV, of which Tata has plentiful in its model range.
What about JLR?
Regardless of good results at home, Tata needs to face the music for JLR. It seems like there are too many battles to fight at the same time: sales in key markets (China), evolution of model range, lack of investment in electric, competition from new brands, new business models,… all of this in a context of staff downsizing and austerity.Only bad news on Tata’s Jaguar/Land Rover unit: a pre-tax loss of over GBP 3 billion, challenges in the Chinese market, 6.4% fall in retail sales, decline in demand for Diesel vehicles, a model range that confuses consumers and that seems to be packed with vehicles that are too similar, lack of fuel economic and emission neutral vehicles…
End of the good days
Tata has been riding a successful JLR wave for a couple years, in better years benefiting from up to 90% of its operating profit and 50% of the company’s revenue coming from the British automaker. This has come to an end now. JLR is cutting costs, and doing it drastically: in the next 18 months, it will fire 10% of its workforce and aim to improve cash flow by GBP 2.5 billion.
Awaiting brighter horizons, Tata’s credit rating is placed on negative watch.
Tata India
The Tata car and truck brand is doing better in its home country, where revenues are growing after an austerity strategy, executed in 2018, which seems to have become the company’s blueprint for JLR. The Indian business reported, for 2018 Q4, a threefold jump in profit, to INR 6.18 billion. The Indian consumer is slowly moving away from the small-vehicle segment into compact and medium sized, and is developing a strong taste for SUV, of which Tata has plentiful in its model range.
What about JLR?
Regardless of good results at home, Tata needs to face the music for JLR. It seems like there are too many battles to fight at the same time: sales in key markets (China), evolution of model range, lack of investment in electric, competition from new brands, new business models,… all of this in a context of staff downsizing and austerity.
