Jaguar/Land Rover costs Tata Motors billions

Jaguar/Land Rover costs Tata Motors billions

Land Rover Discovery4 fq

India’s Tata Motors has recently reported a net loss of $520 million USD (25.05 billion rupees) for the fiscal year ending in March of 2009. Over the same period one year earlier, Tata managed to earn 21.68 billion rupees in profit. Why the big change? Naturally, the global economic crisis has struck the automaker, but the main problem is the relatively poor performance of Jaguar and Land Rover, purchased from Ford last year with the help of a $3 billion USD bridge loan.

The fact that Jaguar Land Rover was responsible for $504 million of that $520 million total loss means that more job cuts and plant shutdowns are in store for the struggling British pair. Tata’s Vice Chairman Ravi Kant said, “We have sent people on sabbatical, gone for cheaper low-cost country sourcing and tight control in cash flows, and are assisting JLR (Jaguar Land Rover) for a major belt tightening.”

Earlier this month, reports suggested that Tata was in search of some $1.5 billion USD in cash and underwriting to pump straight into its JLR operations.

Land Rover Discovery4 fq

India’s Tata Motors has recently reported a net loss of $520 million USD (25.05 billion rupees) for the fiscal year ending in March of 2009. Over the same period one year earlier, Tata managed to earn 21.68 billion rupees in profit. Why the big change? Naturally, the global economic crisis has struck the automaker, but the main problem is the relatively poor performance of Jaguar and Land Rover, purchased from Ford last year with the help of a $3 billion USD bridge loan.

The fact that Jaguar Land Rover was responsible for $504 million of that $520 million total loss means that more job cuts and plant shutdowns are in store for the struggling British pair. Tata’s Vice Chairman Ravi Kant said, “We have sent people on sabbatical, gone for cheaper low-cost country sourcing and tight control in cash flows, and are assisting JLR (Jaguar Land Rover) for a major belt tightening.”

Earlier this month, reports suggested that Tata was in search of some $1.5 billion USD in cash and underwriting to pump straight into its JLR operations.

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