The semiconductor shortages and Brexit-related supply disruptions have been a concern for Jaguar Land Rover (JLR) owner Tata Motors as it’s luxury car sales recover, but on Friday it is confirmed by Indian automaker that these had not yet hit production. As the COVID-19 crisis dented sales Tata Motors had three straight quarters of losses. The pandemic has also caused uncertainties over Britain’s European Union exit, rising cost, and weak demand, but in its third quarter, it has bounced back to clock a profit. Chief financial officer, PB Balaji commented that rather than demand the issue is completely on the supply-side after Tata Motors posted that for the last quarter there is a rise of 67.2% in profit with improved sales at JLR in key markets like China.
They aim to finish the year strong and consolidate the gains, pointed out by Balaji. He said he expects the sales in China to further evolve. In the same period, a year before JLR sales in China jumped 20.2% quarter-on-quarter and were 19.1% higher. At the unit, the overall sales which account for most of Tata Motor’s revenue have increased up to 13.1% from the previous quarter but comparing to the pre-pandemic levels it is still 9% lower. In December the Brexit trade deal between Britain and its former EU partners. This has helped in reducing the traffics on finished vehicles and automotive parts. Bajaj pointed out that this was largely in line with expectations Because of the paperwork that is coming through in the immediate short term there is some degree of friction at the border which was also commented by him. He also added that this should be resolved in weeks since it is being managed without a material impact on production. In the December quarter, it saved 400 million pounds at JLR and their target is 2.5 million pounds and is on track to achieve it.
In the mid-November festive season, the Indians typically make big-ticket purchases which had also helped in domestic sales. This remarks the recovery of the automobile industry after the effect caused by the pandemic. The sales of the car manufacturing industries have improved for the last quarter and this could be the signal of the come back of the automobile industry. A new initiative has also been taken to upgrade the decided plan for the further development of the industry.
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