Tata Profits Drop 96% in Q3

India’s Tata Motors reported a 96% fall in net profit for its third quarter, citing sharply lower earnings at its British luxury carmaker Jaguar Land Rover and losses in its domestic business.

Consolidated net profit for the three months to December 31 fell to 1.12 billion rupees ($16.7 million) from 29.53 billion a year earlier, the company said on Tuesday. Total income from operations fell 4.3% to 685.41 billion rupees, according to Automotive News Europe on February 18.

Retail sales of its Jaguar sedans and Land Rover SUVs rose 8% to 149,288 vehicles in the three months through December from a year before, helped by a 38% rise in sales in China.

While Jaguar retail sales rose about 90% to 45,364 vehicles, Land Rover sales fell 9% to 103,924 vehicles.

Jaguar Land Rover’s net profit declined to 167 million pounds ($208 million) from 440 million a year ago, on revenue up 13.1% to 6.5 billion.

Tata Motors’ domestic business reported a net loss of 10.46 billion rupees as it revamped its passenger vehicles business to boost sales and gain market share.

 New brand

Earlier in February, Tata Motors unveiled a new brand called TAMO, aimed at testing new technologies and enabling the company to become more responsive to changing market trends.

“What is it that we need to be a high performance organization - being lean, it’s about being agile and it’s about having clearly addressed and delegated accountability,” Guenter Butschek, CEO of Tata Motors, told a news conference on Tuesday.

The company is also implementing a management transformation from the beginning of April aimed at bringing in speed, simplicity and agility to deal with market volatility, he said.

Carmakers in India were also hit in the third quarter by Prime Minister Narendra Modi’s “demonetization” move in November, when he declared notes of 500 rupees and 1,000 rupees illegal tender, taking about 86% of total currency out of circulation.