Tata Motors Passenger Vehicles cut its fiscal 2026 margin goal for Jaguar Land Rover on Friday after a cyberattack disrupted production at the luxury carmaker, adding to pressure from soft demand in China and chip supply constraints.
JLR, which generates most of Tata Motors’ profits, is grappling with falling demand for premium cars in China and component shortages after chipmaker Nexperia warned it could no longer guarantee deliveries due to a political standoff between China and the Netherlands.
A cyberattack in early September at Britain’s biggest carmaker halted production for five weeks and forced JLR’s parent to take a one-time charge of $228.5m (R3,909,326,205) in the second quarter.
The Defender maker expects an operating margin of 0% to 2% in fiscal 2026, down from an earlier 5% to 7% target, having pared its outlook this year amid tariff-related uncertainty.
It projects negative free cash flow of £2.2bn (R49,490,804,000) to £2.5bn (R56,239,550,000) for fiscal 2026, reversing its earlier forecast of breaking even.
JLR wholesale volumes slide
JLR CEO Adrian Mardell told reporters the investigation into the cyber incident continued but gave no details, adding operations were “pretty much back running as normal.”
The results also marked the first quarterly earnings since the Tata Motors Group separated its passenger vehicles business from its commercial vehicles unit.
Tata Motors Passenger Vehicles reported a 22-fold surge in quarterly net profit thanks to an 826bn rupee (R160,816,140,000) demerger gain. Excluding the gain, the company reported a 6.37bn rupee (R1,226,958,187) loss, weighed down by a sharp drop in JLR volumes.
JLR’s wholesale volumes, excluding sales from its Chinese joint venture, were down 24.2%.
“China is definitely a concern,” said Mardell, who is set to leave the company after three decades. He said a recent change in luxury tax covered many Range Rovers and was weighing on sales.
A report last month estimated the hack at JLR cost the UK economy $2.55bn (R43,610,318,790). JLR runs three factories in Britain producing about 1,000 cars a day.
Data on Thursday showed the British economy barely grew in the third quarter, weighed down by the disruption.
Reuters
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