Struggling car market and planned Brexit-based plant shutdowns hit British firm's profits, but bosses insist it is on track for 'profitable growth'

Jaguar Land Rover recorded a £395 million loss in the last three months, due to declining sales and the impact of a planned Brexit shutdown – but company boss Ralf Speth insists the firm is on track to deliver “sustainable profitable growth” in the future.

The British firm sold 128,615 vehicles in the first three months of the 2019/2020 financial year running from April until June, a 11.6 per cent year-on-year decline. Those sales results in Jaguar Land Rover achieving £5.07 billion of revenue, down 2.8% year-on-year. The pre-tax loss of £395 million compared to £264 million in the same period last year.

As well as declining sales, Jaguar Land Rover’s profits were also affected by it shutting its factories in April as a contingency to coincide with the original planned date of Britain’s exit from the European Union. The results were in line with the company’s outlook for the quarter.

There were some positives, with UK sales for the period up 2.6% year-on-year, while the firm also says that sales in China – where Jaguar Land Rover has struggled in a declining market – rose in June compared with the previous month.

Jaguar Land Rover also said that sales of the Jaguar I-Pace and Range Rover Evoque were up year-on-year, and says the recent arrival of facelifted versions of the Range Rover Discovery Sport and Jaguar XE should help.

The company is undergoing a major £2.5 billion cost-cutting project in a bid to boost profitability, and Jaguar Land Rover claims it has already delivered £100 million in savings.

Speth said that the firm was “in a period of major transformation”, adding: “We will build on our strong foundations and increased operating efficiency to return to profit this fiscal year.”

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Speth added that the firm was creating a “more robust and resilient business”, and said that new products, including the forthcoming Land Rover Defender, “will pave the way for sustainable profitable growth.”

Read more

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Analysis: why Jaguar Land Rover faces tough times

Jaguar Land Rover posts £3.4 billion loss in final quarter of 2018

 

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Comments
31

25 July 2019

Make some 4 metre to 4.3metre long smallaer suv 's and a hatchback,a smaller platform to make smaller Evoque  smaller ,Discsport and call it Freelander and an A3 5 door and estate type car.At £202k to £35k they would clean up 300k to 500k vehicles  in extra sales each year.

25 July 2019
Ski Kid wrote:

Make some 4 metre to 4.3metre long smallaer suv 's and a hatchback,a smaller platform to make smaller Evoque  smaller ,Discsport and call it Freelander and an A3 5 door and estate type car.At £202k to £35k they would clean up 300k to 500k vehicles  in extra sales each year.

Because you need huge amounts of volume and highly adaptable platforms at that end of market, JLR can't compete with Merc & BM in their current markets, so hope would they have entering that one.

25 July 2019

They aren't into large volume cheap'ish cars. Volvo are actually pulling out of that market once the V40 finishes.

25 July 2019

report says they suffered an 11.6% drop in volume but only a 2.8% drop in revenue.  Suggests their unit price increased by about 8%.  This suggests that if they can arrest the fall in sales then profitability is likely to return pretty quickly, given the cost reduction efforts underway. 

 

25 July 2019

They've just been loaned £500,000,000 by the British Government, is this money factored into the loss?

25 July 2019
owenmahamilton wrote:

They've just been loaned £500,000,000 by the British Government, is this money factored into the loss?

No.

25 July 2019

No worries

Our government will bail out this Indian company time and again

Tata is laughing its head off

Free money from the brits

25 July 2019
I hope JLR survive so that they continue to provide an alternative to the other marques.

However, they have to start offering the right mix of quality, reliability and value for money. I find JLR products are often overpriced for what they are.

The Jaguar XE is finally the product it should have been - though it remains to be seen whether the reliability has improved. A relatively small company cannot afford to drop the ball like that.

25 July 2019

What's all this rubbish about blaming a planned Brexit shutdown?

As I understand it all that happened was an already planned shutdown was brought forward. It was nothing more than a date change, so how can that possible affect profits? Unless the shutdown lasted longer than normal then the effect on profits should have been zero, zilch, sod all.

25 July 2019

Meanwhile PSA are being touted by Forbes as the turnaround kings with premium luxury product profit margins from their mass market vehicles how long before they take over JLR?

https://www.forbes.com/sites/neilwinton/2019/07/24/psa-of-france-overtakes-bmw-mercedes-in-profit-race-urged-to-seek-acquisitions/#47ccef3f5073

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