JLR owner Tata Motors posts smaller March-quarter loss as demand improves

JAGUAR LAND ROVER (JLR) owner Tata Motors reported a smaller loss for the fourth quarter on Thursday (May 12), as the luxury carmaker benefitted from improving demand for its vehicles and managed to keep a lid on rising costs.

Carmakers across the globe have resorted to gradually hiking prices in a bid to deal with steep raw material and shipping costs, which are squeezing profit margins at companies looking to recover from the pandemic hit.

Tata Motors has hiked prices at least 4 times in fiscal year 2022.

For the quarter ended Mar 31, Tata Motors' cost of material consumed was down 8.8 per cent at 475.90 billion rupees (S$8.6 billion).

Consolidated net loss was 10.33 billion rupees, compared with 76.05 billion rupees a year earlier, when semiconductor shortages and supply chain disruptions hurt sales.

Last month, rival and the country's top carmaker Maruti Suzuki India beat estimates for quarterly profit margins, as a string of price hikes and lower sales promotion expenses helped it offset the impact of higher raw material prices.

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Passenger vehicle business delivered a comprehensive turnaround in the fourth quarter and demand remained strong despite geopolitical and inflation concerns, Tata Motors said.

Tata Motors has been under intense pressure due to a crunch in supply of semiconductors, it said, adding that full-year performance at JLR was significantly impacted by the constraint on production and sales due to the chip shortage.

However, it said it expected performance to improve through the year as the China Covid-19 situation and semiconductor supplies improve, adding that it aims to get to near net auto debt free by FY24.

The company's total revenue from operations for the quarter fell 11.5 per cent to 784.39 billion rupees.