TATA Motors, the commercial vehicle major and the owner of Jaguar Land Rover, reported a consolidated loss of Rs 8,443.98 crore on July 31, for the quarter ended June 2020 as lockdown in several countries affected JLR as well as domestic businesses.
The loss was significantly higher than Rs 3,679.66 crore loss posted in Q1FY20 and Rs 9,863.75 crore loss in Q4FY20.
|Q1FY21 (in crores)||Q1FY20 (in crores)||Change|
*Total Volume = PV (Personal Vehicle) + CV (Commercial Vehicle) + Exports
In the JLR segment, the company said COVID-19 resulted in temporary retailer and plant shutdowns, significantly impacting sales and profit
JLR net revenue declined 44 per cent to 2.9 billion pounds during the quarter under review and as a result, it posted a loss before tax of 413 million pounds.
Global lockdown restrictions impacted Jaguar Land Rover, it’s luxury car unit. Going forward, the outlook remains uncertain for the year owing to pandemic related lockdowns and limitations.
“In this context, we are committed to significantly deleveraging the business in the coming years and aim to generate positive free cash flows over last 3 quarters of the year by focusing on better front end activation of our exciting product range, and executing our cost and cash savings with rigour,” said the company.
Commenting on the quarterly performance, Guenter Butschek, CEO and MD, Tata Motors, said: “The COVID-19 pandemic has deeply impacted the auto industry in Q1FY21. Post a calibrated restart at all plants in mid-May, we gradually scaled up our capacity while prudently safeguarding the health and wellbeing of our employees as well as the larger ecosystem.“
Tata Motors announced a cash improvement program of Rs 6,000 crore, including a cost improvement program of Rs 1,500 crore. The CAPEX* is expected to be around Rs 1,500 crore for FY21.
*CAPEX: Capital Expenditures, are funds used by a company to acquire, upgrade, and maintain physical assets such as property, buildings, an industrial plant, technology, or equipment.
In conclusion, TATA Motors looks forward to a gradual pickup in demand and improvement in supply in the second half of fiscal 2021 as overall economic activity picks up.