Automaker Tata Motors Ltd posted its biggest quarterly loss on Thursday, hurt by an impairment charge for its British luxury car business Jaguar Land Rover.
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 in the quarter ended June 2018.
While Tata Motors has announced plans to turn around JLR, the slide in the unit's sales has continue for now.
The company took a non-cash charge of Rs 27,838 crore ($3.90 billion) to cover the impairment at JLR in the three months to December 31. Changes in market conditions, especially in China, technology disruptions and rising cost of debt resulted in the charge.
"...Overall 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 CEO Ralf Speth said.
JLR said last month it would cut 10 per cent of its workforce, mostly in its home market, as Britain's biggest carmaker responded to lower Chinese demand and a slump in European diesel sales.
Tata Motors' loss came at Rs 26,993 crore ($3.78 billion) for the three months ended December 31, compared with a profit of Rs 1,199 crore rupees in the year-ago period.
Revenue rose 5.8 per cent to Rs 76,265 crore.
Tata Motors has been facing a decline in sales in India as well.