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JLR factory

JLR factory

JLR's China retail sales nearly halved in the quarter as demand for cars from the Asian economic powerhouse shrank for the first time since the 1990s. Jaguar chief executive Ralf Speth said: "Jaguar Land Rover reported strong third-quarter sales in the United Kingdom and North America, but our overall performance continued to be impacted by challenging market conditions in China".

Last month Jaguar Land Rover joined Honda and Toyota in announcing a post-Brexit temporary plant shutdown, which will affect all three of its United Kingdom auto factories, as well as its engine plant in Wolverhampton.

Jaguar Land Rover's owner Tata Motors Ltd stunned markets by posting the biggest-ever quarterly loss in Indian corporate history of about $4 billion on slumping China sales, sending its shares crashing as much as 30 percent.

"Performance was impacted by challenging market conditions, particularly in China and inventory corrections".

The automotive industry is facing significant market, technological, and regulatory headwinds.

JLR has taken steps to address the slide in China sales by changing its strategy to focus on profits for dealers instead of sales and incentivising retail sales over wholesale, he said.

"Given the muted demand scenario and the associated impact on the financials, JLR has concluded that the carrying value of capitalised investments should be adjusted down, resulting in a non-cash 3.1 billion pre-tax exceptional charge and an overall pre-tax loss of 3.4 billion for the quarter", Tata Motors said in a statement.

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Commenting on the step, JLR Chief Executive Ralf Speth said, "We are announcing a non-cash exceptional charge to reduce the book value of our capitalised investments".

For the quarter, Jaguar-Land Rover (JLR) reported a negative EBIT of 2.6 percent, which was 520 basis point (100 bps= 1 percentage point) lower than the same period past year. U.S. sales rose 20 per cent and 18 per cent in the UK.

Speth said: "This is a hard time for the industry but we remain focused on ensuring sustainable and profitable growth and making targeted investments that will secure our business in the future".

JLR realised £500m of cash improvements through the "Charge" programme in the third quarter.

As part of the plans, JLR last month announced investments worth hundreds of millions of pounds to produce electric drive units at Wolverhampton.

The company continues to invest in new vehicles, electrification, and technology.

JLR's revenue, however, declined 1 per cent to 6.2 billion pounds.

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