Tata-owned Jaguar Land Rover will post at the end of the financial year a much lower pretax profit than in 2014-2015, its chief executive told Reuters in an interview.
The British brand Jaguar Land Rover, owned by India’s Tata Motors, sold 23 percent more cars in the third quarter of the financial year which ended on December 31. Over that period, Jaguar deliveries increased with 30 percent and Land Rover rose 22 percent, marking the strongest quarterly sales performance in the company’s history. However, of its most important three markets, China was the only one where demand dropped 10 percent. Same strong results are to be announced for the final quarter of the financial year, with China likely to be again an exception. Despite these numbers, Jaguar Land Rover will post lower fourth-quarter profit than a year earlier, like it did for the third one, for the full-year pretax figure to be halved compared to the 2.6 billion pounds (3.6 billion dollars) made in 2014-2015.
The reasons behind this unexpected financial outcome are the slow China sales, the explosions at the Tianjin port and the high costs triggered by the expansion of brand’s lineup and its facilities. The premium maker will report a profit for the fourth quarter with 400 million pounds lower than a year ago, CEO Ralf Speth told to Reuters in an interview at the Geneva Auto Show. “It was a sensational quarter, the last one of 2015. We will not achieve that,” he said. As for the sales drop in China, the market there “has seen the bottom and is bouncing back and therefore I am cautiously optimistic that we will see a stronger performance,” Speth added.