Jaguar Land Rover losses deepen on Brexit planning

Car maker Jaguar Land Rover (JLR) reported deeper first quarter losses as plant shutdowns and Brexit contingency planning took their toll.

The high-end vehicle manufacturer reported a loss before tax of £395m for the three month period ended 30 June, a deterioration from the £264m loss in the same period last year, as revenues declined 2.8% to £5.1bn.

Global retail sales fell by 11.6% to 128,615 vehicles as additional plant shutdown time and delays in EU emissions certification resulting from Brexit contingency planning contributed to the lower sales and profits.

However, the company had record sales in the UK, 2.6% higher than the same period last year, while June sales in China rose month on month.

Jaguar, owned by India's Tata Motors, said its transformation programme has already resulted in £100m of cost savings and £300m reduction to previously planned investment in the quarter, with the programme on track to achieve £2.5bn of cash and profit improvements after having now achieved a total of £1.7bn to date.

Jaguar Land Rover still expects its results to improve over the balance of the year and continues to target a 3%-4% EBIT margin for the full year, with continued investment resulting in negative but improving cash flows.

Ralf Speth, chief executive of JLR, said: "Jaguar Land Rover is in a period of major transformation. We are simplifying our business, delivering on our product strategy and adapting to the tough market environment. We will build on our strong foundations and increased operating efficiency to return to profit this fiscal year."

"In this period, we expect to see the impact of growing demand for new models such as the Range Rover Evoque, Discovery Sport and Jaguar XE, whilst implementing our ‘Charge’ transformation programme."

(Editing by Frank Prenesti)