Tata Sons chairman N Chandrasekaran on Friday led the management and shareholders of Tata Motors in paying homage to the victims of the Air India plane crash by observing a minute’s silence at the company’s 80th annual general meeting (AGM) here.
This was the first AGM of a Tata Group firm that Chandrasekaran has attended since the June 12 crash. He did not attend the AGMs of Tata Consultancy Services (TCS) and Tata Consumer Products, which took place earlier this week.
At the AGM held virtually on Friday, Chandrasekaran said the auto sector is going through testing times amid widespread geopolitical conflicts, military escalations, redrawing of supply chains and tariff regimes to artificial intelligence (AI) and energy transition. “Nowhere are all these disruptions visible more than the auto sector,” he said.
The latest to disrupt the sector is the shortage of rare earth materials used for manufacturing permanent magnets, which are used in motors in electric and internal combustion engines. The industry has already sounded out an alarm to the authorities about the limited number of magnets in the inventories lasting for only a few weeks. If regular supplies are not reinstated, it will cripple automotive production in India, automakers fear.
Chandrasekaran informed Tata Motors’ shareholders that the company has enough stock of permanent magnets and there will be no impact on production in the immediate period.
Tata Motors clocked a group revenue of Rs 4.39 lakh crore, a rise of 1.3% and a profit after tax (PAT) of Rs 28,149 crore, a fall of 12% in FY25 compared to FY24. During FY25, the company registered a drop of 3% in wholesale volumes to 1.34 million units against FY24.
Tata Motors-owned Jaguar Land Rover (JLR) has had to suspend supplies to the US, its biggest market globally, following an increase in tariff on automotive imports imposed by the Trump-led government.
“From 2.5%, the tariff would have gone to 27.5%. With the trade deal of the UK with the US, this will drop to 10%. The overall impact of this will be £1.6 billion. But JLR has taken a lot of steps through which they will be able to reduce the impact to £600 million,” Chandrasekaran said.
Tata Motors is undergoing a process of demerger, wherein the commercial vehicle (CV) unit is being designed to be put under a separate listed company. The remaining business will have passenger vehicles (PVs), including electric vehicles and JLR.
“We should be able to have two independent listed companies — one with CVs and the other with passenger vehicles and JLR — hopefully before the end of this year,” Chandrasekaran added.
He also said the company is focusing to reverse the market share slide seen in the small CV segment. “An area where we need to deliver is to improve the performance and market share in the SCV segment, which is severely underperforming, and the company is focused on addressing this in this year,” he said.