 "JLR owner says slow China economy hurting luxury car sales")
By P R Sanjai and Satviki Sanjay
Jaguar Land Rover’s Indian owner said profitability is being hurt by economic challenges in China, a market where weak demand and consumer preference for electric vehicles are hurting sales of traditional top-end cars.
“The environment in China continues to experience macro headwinds with a decrease in overall profitability, increase in retailer insolvency and contraction of bank credit,” P B Balaji, group chief finance officer at Tata Motors Ltd., said at the recently concluded Bharat Mobility Global Expo 2025 in New Delhi.
While continuing weakness in the world’s No. 2 economy has meant consumers are spending less on luxury purchases, a simultaneous shift toward advanced EVs in the market dominated by local manufacturers such as BYD Co. is also hurting the likes of JLR, Porsche AG and Mercedes-Benz Group AG.
During the September quarter, wholesale volumes in China were down 38 per cent on-year, compared to a 44 per cent jump in the North American market and a 6 per cent increase in Europe. JLR is by far the largest division of Tata Motors, making up more than two-thirds of the Indian group’s revenue.
Balaji said Tata will be watchful of the overall global situation, particularly China. He said JLR’s performance in China was “resilient” even though the segment has shrunk, and that the company was ensuring “optimal inventory” at dealerships.
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The luxury unit will continue to increase investment in products and technologies in its goal to grow revenue, improve profitability and generate positive free cash flows, he said.
“As has been committed, we are on track to deliver a net cash position by end of this financial year,” Balaji said to a question on making JLR debt free.
Tata Motors is separately beefing up its line up of EV offerings in India to take on local and global rivals in the nascent-but-fast-growing segment of green vehicles.
“There is an exciting range of products lined up to be launched over the next three years including the all-electric Jaguar which was recently showcased,” Balaji said.