Indian car maker Tata Motors posted its biggest quarterly loss, hurt by an impairment charge for its Jaguar Land Rover business.
Troubles at the Jaguar Land Rover (JLR) unit, which has been hit hard by US-China trade tensions, low demand for diesel cars in Europe and Brexit worries, had tipped Tata Motors into its first loss in three years, for the quarter ended June 2018.
Tata Motors has announced plans to turn around JLR but the slide in the unit’s sales has continued for now.
The company took a non-cash charge of 278.38 billion rupees (€3.43bn) to cover the impairment at JLR in the three months to the end of December.
Changes in market conditions, especially in China, technology disruptions and increased cost of debt resulted in the charge.
It said that its performance “continued to be impacted by challenging market conditions in China”.
“We continue to work closely with Chinese retailers to respond to current market conditions with a ‘pull’-based approach to vehicle sales,” JLR chief executive Ralf Speth said.
JLR said last month it would cut 10% of its workforce, mostly in its home market, as the carmaker which is the biggest car producer in Britain responded to lower Chinese demand and a slump in European diesel sales.
Tata Motors’ loss came at 269.93bn rupees for the quarter, compared with a profit of 11.99bn rupees in the year-ago period.
Revenue rose 5.8% to 762.65bn rupees.
Tata Motors has been facing a decline in sales in India as well.