India’s Tata Motors, the owners of the Jaguar and Land Rover brands, reported a fourth consecutive quarterly loss, weighed down by higher commodity prices and the global semiconductor shortage.
The company’s shares fell 2.5% on Tuesday after closing 4% higher at the end of Monday’s trade in Mumbai ahead of the earnings announcement.
Microchips are a key component in car manufacturing but automakers around the world have been hamstrung by limited supplies due to semiconductor production cuts during the pandemic.
The Mumbai-headquartered firm reported a net loss of 15.2 billion rupees ($203 million) in the three months to December 31, compared with a net profit of 29.1 billion rupees a year earlier.
Operational revenue slipped 4.5% to 722.3 billion rupees from a year earlier.
Adverse Impact
“The auto industry continued to witness rising demand in most segments even as the supply of semiconductors remained restricted, resulting in adverse impact on production,” Tata Motors’ executive director Girish Wagh said in a statement.
“The semiconductor supply situation is improving gradually whilst inflation worries persist,” the company added.
Retail sales for Tata Motors’ British subsidiary, Britain’s biggest carmaker Jaguar Land Rover, were “significantly constrained by chip shortages and low inventories” and fell 37.6% year-on-year.
But the company’s India business saw revenue rise by 43.3% on the corresponding period, with sales up across all vehicle segments.
Its electric-vehicle (EV) arm reported a new quarterly sales high of 5,592 cars.
“Tata is leading [its competitors] in EV sales with 2,900 units in January, a rise of 28% month-month and accounting for 7% of its passenger vehicle volumes,” Nitij Mangal, equity analyst at Jefferies in Mumbai, noted.
- AFP, with additional editing by George Russell
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