Chandrasekaran Promises Turnaround For Tata Motors, JLR In FY19
Tata Motors Ltd. and Jaguar Land Rover will turn profitable in FY19.
That’s the word coming in from N Chandrasekaran, the chairman of Tata Sons—the holding company of the salt-to-software Tata Group.
Tata Motors reported its worst loss in nearly nine years in the quarter ended June, as its U.K.-based luxury car unit—which contributes 78 percent of its sales—reported a loss of 210 million pounds ($276 million) in the same period. The Mumbai-based automaker’s shares have dropped over 40 percent year-to-date.
Chandrasekaran said at the 73rd annual general meeting of Tata Motors, that JLR is facing cash-flow issues and they’re recalibrating its strategy. “JLR is embarking on a very strong cost-reduction plan. We don’t know what it’ll return, but we’re working on every single way to maximise efficiency, take costs out and produce enough operating cash flow.”
JLR, on a quarterly basis, is making upwards of 5 billion pounds of revenues, Chandrasekaran said. “On a yearly basis it’s over 20 billion pounds.”
Move To Electric Vehicles
Signalling that most cars from the JLR stable will be electric by 2020, Tata Motors’ Chief Financial Officer PB Balaji said: “We have to make those capital investments as we’ve to be ready for the future.”
The company also said its foray into electric vehicles will depend on how well the technology picks up. It said it has identified 20 cities for the penetration of electric vehicles, though it failed to specify a timeline.
“Two platforms with electric power-trains will come up,” said Chandrasekaran. “If the movement picks up, we’ll be ahead of the curve.”
When asked whether Tata Motors would suspend manufacturing its economy car, the Tata Nano, Chandrasekaran neither confirmed nor replied in the negative. A decision would be taken based on the business case, he said. “The idea is to have a number of attractive cars in the market.”