China saves JLR blushes as it clocks 2 pct growth in FY18

On the face of it the growth of Tata Motors-owned Jaguar Land Rover (JLR) at 1.7% for the year ending March 31, 2018, may look weak, but with its key home markets seeing a decline in sales, the performance doesn’t look so unimpressive.

Its big saviour has been the land of dragons, China, where sales grew at a record 19.9% in the fiscal (the only market where it recorded double-digit growth). Growth in North America was 4.7% and in overseas markets, including India, 3.4%.
JLR’s traditional markets, UK and Europe, saw sales decline of 12.8% and 5.3%, respectively, in the fiscal, primarily due to lower demand for its diesel guzzlers.

In a release on Monday, JLR said it has sold 6,14,309 vehicles for the financial year ended March 31, driven by new models including the Range Rover Velar and the all new Land Rover Discovery, while its recently launched 18 Model Year Range Rover and Range Rover Sport and the Jaguar E-PACE were still “ramping up”, it said.

“Weaker market conditions in the UK and Europe, driven by the lack of consumer confidence and lower demand for diesels, are impacting our growth. But even against this backdrop, it’s good to see that we have closed our financial year with record retail sales,” said Felix Brautigam, chief commercial officer, JLR, in a release.

Meanwhile, the Chinese government’s plan to impose 25% tariffs on various categories, including automobiles, imported from the US, is expected to benefit JLR.

According to a report by Nomura, JLR could benefit from this tariff imposition. The report factors in a possible 12% volume growth in FY19 for JLR.

JLR sales for March alone were down by 7.8% to 83,732 units, primarily due to lower UK and Europe sales.

“UK industry sales were down 15.7% in March, more than explained by lower diesel sales, although March 2017 was an all-time industry record with increased sales in advance of an increase in vehicle taxes in April 2017,” said the release. A mail sent to JLR spokesperson in UK went unanswered. Tata Motors shares ended at `358.30 on Monday, down 1.53% on BSE.