Tata Motors PV slips into a loss in Q2 as JLR woes mount
TMPVL is the only one among India’s top four carmakers to report a loss during the quarter. That came as its British subsidiary, which contributes about 80% of the revenue, grapples with the impact of a cyberattack and US tariffs.
NEW DELHI : Tata Motors Passenger Vehicles Ltd slipped into losses in the September quarter as its British subsidiary Jaguar Land Rover faced output cut and pared its profit margin guidance due to a cyberattack at manufacturing plants, higher US tariffs and a new tax in China.
Jaguar Land Rover, which accounts for 80% of its newly demerged parent’s revenue, cut its operating profit margin guidance to 0-2% from 5-7% for the 2025-26 fiscal amid multiple headwinds, even as it works to bring production back to the original level. JLR has projected to end the year with a negative cash flow of 2.2-2.5 billion euros, moving away from its earlier guidance of ending with nearly no free cash flow.
Tata Motors Passenger Vehicle Ltd’s (TMPVL) revenue fell 13.5% on-year to ₹72,349 crore in the second quarter, according to its filings. The company, which reported its first quarterly earnings after demerging from the combined Tata Motors Ltd, reported a loss of ₹6,368 crore for the quarter against a profit of ₹ 3,056 crore a year earlier.
Earnings before interest, tax, depreciation, and amortization (Ebitda) margins of the company fell 11.2 percentage points to -0.1%.
TMPVL is the only one among India’s top four carmakers to report a loss during the quarter. Maruti Suzuki India Ltd, Mahindra and Mahindra Ltd and Hyundai Motor India Ltd reported profit growth.
Global headwinds weigh on luxury unit
“It has been a tough quarter. However, we have been strengthening our business fundamentally for many years and will continue to do so. We are sure JLR will make a comeback," PB Balaji, the outgoing chief financial officer of Tata Motors, said during the post results press briefing. Balaji will take charge as JLR’s chief executive from 17 November.
“The overall global situation remains challenging. To respond effectively, we will focus on stabilising production and increasing resilience throughout the extended supply chain," Balaji said, adding that domestic business continues to witness robust demand following the rollout of GST 2.0.
This is the second straight quarter JLR has dragged down Tata Motors’ performance. In the April to June quarter, consolidated profit fell about 63% to ₹3,924 crore from ₹10,514 crore a year earlier, missing the consensus estimate of ₹4,055 crore in a Bloomberg poll. Consolidated revenue was down 2.5% at ₹104,407 crore.
That stemmed from the imposition of tariffs by US President Donald Trump’s administration in April.
While the trade deal between the US and UK cushioned the increase from 25% tariffs to 10%, it was still higher than 2.5% prior to April 2025. North America is JLR’s biggest market.
Moreover, China imposed a 10% tax on most luxury cars in the domestic market in July, hurting JLR’s sales.
In the second quarter, the cyberattack at Jaguar Land Rover’s facilities worldwide in September disrupted production at the company's three manufacturing facilities—Solihull, Halewood, and Wolverhampton—in the UK, as well as those in Pune, India, and Nitra, Slovakia. Total sales of the British luxury carmaker fell 24% over a year earlier to 66,200 units in the quarter.
Domestic demand offsets some losses
While JLR struggled, the domestic passenger vehicle business saw its revenue grow 15.6% to ₹13,529 crore. Sales rose 10% to 144,397 units.
Profitability also suffered due to higher commodity prices, which the company was not able to offset with price hikes. Profit before tax for TMPVL fell over 32% year-on-year to ₹155 crore during the January to September period.
However, the management is betting on strong consumer demand and revenue growth in the coming quarters. The company could increase prices the January to March to offset commodity price inflation, said new CFO Dhiman Gupta.
“We had some very strong bookings that we received in both September and October, which we could not fully service during the festive period. So there is some significant part of that booking that has overflown to November," Shailesh Chandra, managing director and chief executive at TMPVL, said in a post results press briefing. “December will be another big retail month. We will have significant bookings that we expect to receive."
TMPVL’s shares ended 1.62% lower ahead of the earnings announcement on Friday against a 0.52% fall in Nifty Auto.
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