Tata Motors Braces For Revenue Hit As JLR Faces US Tarrif Impact

Tata Motors would likely bear the maximum impact of the tariffs due to its luxury subsidiary, Jaguar Land Rover (JLR), which has significant exposure to the American market. In FY24, JLR sold over 400,000 vehicles globally, with approximately 23 per cent of its sales coming from the US.

“The US accounted for over a fifth of JLR’s revenue last year, making it a key market. Given limited options to sustain margins and meet prior financial guidance, JLR may have to resort to price hikes and cost-cutting measures. However, these strategies won’t provide immediate relief, and a short-term hit to both revenue and profitability is expected,” said Nirav Karkera, Head of Research at Fisdom.

Siddhartha Khemka, Head of Research and Wealth Management at Motilal Oswal, highlighted the risks associated with price adjustments. “If JLR can proportionally increase prices, the revenue impact will be minimal. However, if demand declines due to higher prices, both sales volume and profit margins could take a hit,” he told Moneycontrol.

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As the auto industry grapples with these new tariffs, market participants remain cautious about broader implications for global trade and corporate earnings in the sector.