Tata Motors profit falls 63% on JLR slump, US tariffs

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Tata Motors profit falls 63% on JLR slump, US tariffs

8:27 CAT | 11 Aug 2025

FILE - For illustration purposes only. [File photo: Tata Motors]

Jaguar Land Rover parent Tata Motors Ltd. reported a slightly lower-than-expected quarterly profit, as softer demand and US trade tariffs took a toll on its domestic and global businesses.

Net income fell 63% to 39.2 billion rupees ($447 million) in the three months ended June 30, compared with the same period last year, the company said in a filing Friday. It fell short of the average profit estimate of 40.55 billion rupees based on a Bloomberg survey of analysts.

Revenue fell 2.8% to 1.04 trillion rupees, beating analyst estimates, according to an exchange filing Friday. Total costs inched up 0.1% to 1 trillion rupees. Tata Motors said that US tariffs led to an incremental cost of £254 million ($341 million).

The US levies “had a direct and material impact on profitability and cash flow in the period,” Tata Motors said in the statement. “The US-UK trade deal will significantly reduce the financial impact of US tariffs going forward.”

JLR, which typically contributes about two-thirds of the overall revenue, paused shipments to the US for nearly a month in April in response to President Donald Trump’s import tariffs. North America is the most important overseas market for the luxury marque, which sold nearly 100,000 units in the year to March 2024, according to its latest annual report.

Tata’s revenue also suffered from sluggish demand in India for cars and commercial vehicles, which has also weighed down sales at rival automakers including Hyundai Motor India Ltd. and Maruti Suzuki India Ltd. Local business, which includes commercial and passenger vehicles, recorded sales of 156.8 billion rupees, down 7% from last year.

The automaker plans to “mitigate the impact of tariffs by leveraging the brand strength to drive a better mix, and targeted actions to improve contribution margins,” P.B. Balaji, group chief financial officer, said in the filing. He added the “demand situation is likely to remain challenging.”

Earnings before interest, taxes, depreciation and amortization, or Ebitda, fell 38% to 97 billion rupees.

JLR’s pre-tax profit fell 49% to £351 million on a quarterly revenue of £6.6 billion. The maker of luxury sports utility vehicles said that free cash flow for the year ending March 2026 is expected to be close to zero with earnings before interest and taxes, or Ebit, margins to be within 5% to 7%.

The earnings come days after JLR announced that its Chief Executive Officer Adrian Mardell is leaving the UK-based luxury carmaker.

CEO change

This marked the latest CEO change at a major automaker after new leaders for Renault SA, Stellantis NV and Volvo Car AB. The industry has been battered by falling sales in China, weak demand for EVs in Europe, and more recently, the US tariffs.

Tata Motors last month bought Iveco Group ’s commercial vehicle business for €3.8 billion, adding muscle to its global presence.

While Balaji called the target a “screaming buy” in a press briefing last week, brokerages have been more circumspect. Jefferies analysts called it “a risky detour” in a note, citing the equity-raise plan and Indian firms’ mixed track record with European acquisitions.

Source: Bloomberg