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Tata Motors reassessing JLR's forecast as US tariffs fan uncertainty
Imported cars have been a main focus of U.S. President Donald Trump's global trade war.
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Reuters - Tue, 13, May 2025
- 22:48 EDT
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Jaguar and Land Rover, the British vehicle-brand logos of Indian-owned Tata Motors, are displayed in front of their showroom in New Delhi, India, April 2, 2025. / REUTERS/Priyanshu Singh/File photo
India's Tata Motors said on May 13 it was reevaluating its annual profitability target for luxury car brand Jaguar Land Rover (JLR), joining automakers worldwide that have flagged forecast uncertainty due to U.S. tariff changes.
Imported cars have been a main focus of U.S. President Donald Trump's global trade war. Trump last month imposed a 25 percent tariff on all foreign-made vehicles sold in the world's second-largest car market.
UK-based JLR, which counts the U.S. as its fastest-growing market, met its earnings before interest and taxes (EBIT) margin target of 8.5 percent for the year ended March, but abstained from confirming its fiscal 2026 target of a 10 percent EBIT margin, announced in June.
"We are assessing our guidance in light of the recent UK-U.S. trade deal announced on May 8 and will provide an update at our investor day on June 16," said parent Tata Motors, which gets about two-thirds of its overall revenue from JLR.
The U.S. and the UK signed a trade deal last week that allows the latter to export 100,000 cars a year under a 10 percent tariff, lower than the 25 percent levy for other nations.
Despite the deal, analysts expect JLR's North America sales to drop this fiscal year, with some noting that the top-selling "Defender" SUV, which is made in Slovakia, is not covered under the deal.
"We'll probably be able to see the implications of all those (tariffs) in the coming quarters," Group CFO PB Balaji said in a media call.
Automakers globally, including Mercedes-Benz, Fiat-owner Stellantis and Volvo, have either abstained from issuing forecasts or pulled their earnings forecasts.
Still, JLR's sales volumes rose 1.1 percent in the January-March quarter, helped by strong demand for its SUVs in North America and Europe.
That helped Tata Motors' fourth-quarter profit of 84.70 billion rupees ($993 million) beat analysts' estimates of 74.58 billion rupees, according to data compiled by LSEG.
The company's profit halved from the year-ago quarter, which included a one-time tax benefit.
Tata Motors' shares closed 1.8 percent lower ahead of the results. ($1 = 85.2750 Indian rupees)
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