Tata Motors is in the red due to covid problems and chip shortages.
Even as Covid-19 lockdowns and semi-conductor shortages affected the firm’s bottom line, Tata Motors’ losses reduced between April and June, buoyed by a 108 percent increase in revenues, the company said Monday.
In the quarter ending June 30, the owners of the Jaguar and Land Rover brands lowered their consolidated net losses by 47 percent to 44.50 billion rupees ($598 million), compared to 84.43 billion rupees the previous year.
Despite the fact that a new pandemic wave forced interim plant closures in April, the limits were less severe than the total shutdown imposed a year before.
Year-on-year, the automaker’s quarterly revenues more than doubled to 664.06 billion rupees.
As the British luxury car brand Jaguar Land Rover (JLR) continued to rebound, sales at its UK-based subsidiary surged 68 percent year on year.
A global shortage of semi-conductor chips, however, hampered output, resulting in a pre-tax loss of?110 million in the quarter, according to JLR.
Semiconductor manufacturing cuts induced by the pandemic have resulted in a global shortage of microchips, which are a critical raw material in electronics and are now a fundamental component in automobiles.
The UK’s largest car manufacturer said earlier this month that the shortages could result in a halving of sales in the July-September quarter.
“While the present situation remains challenging, we will continue to adapt and manage things that are under our control,” JLR CEO Thierry Bollore said in a statement following the announcement.
“The sheer amount of demand for our vehicles continues to inspire us,” he continued.
“Semiconductor difficulties, commodity inflation, and pandemic uncertainty will have an impact in the immediate term,” Tata Motors stated on Monday.
The electric vehicle sector at Tata Motors has proven to be a bright spot. The 1,715 units sold in the quarter were a five-fold increase over the previous quarter and the biggest ever.
In Mumbai, the company’s shares finished 0.95 percent lower ahead of the earnings report.