Jaguar Land Rover Automotive Plc slashed its guidance and swung to a heavy quarterly loss after a cyberattack temporarily halted production at the UK’s largest automaker.
The Range Rover maker said Friday its profit margin for the full year could now be entirely wiped out, having previously targeted as high as 7%. It now expects free cash burn of as much as £2.5 billion ($3.3 billion), after previously aiming for little change.
The company, owned by Tata Motors Passenger Vehicles Ltd., slumped to a loss after tax of £559 million for the three months through September, compared to a profit a year earlier, in part due to £196 million of costs related to the hack.
The cyberattack forced JLR to halt production for almost six weeks, an unprecedented shutdown for such an incident. The fallout for JLR, already under pressure from higher US tariffs, was so severe it dented the UK economy and forced the government to step in with a £1.5 billion emergency loan guarantee to help struggling suppliers.
Some operations slowly resumed last month, and production has “now returned to normal levels,” JLR said Friday. The company also created a £500 million financing program for qualifying suppliers, allowing them to receive cash much earlier than normal.
JLR’s revenue slumped 24% in the most recent quarter after wholesale volumes and retail sales fell. Its main sellers are the Range Rover and Defender sport utility vehicles. The company is no longer making Jaguar vehicles after embarking on a rebrand with plans for a new, fully-electric lineup that’s sparked controversy.
It has been a “difficult period for the business,” said Tata Motors Chief Financial Officer P B Balaji, who’s soon taking over as JLR CEO from Adrian Mardell.
The cyberattack also took a toll on the parent company, with group revenue dropping 14% to 723.5 billion rupees ($8.2 billion). JLR makes up the majority of sales. One-time gains from the separation of the commercial vehicles business helped net income jump to 761.7 billion rupees.
Respite in India
The local market provided some respite for JLR’s Indian parent. It’s now leaning on a pick-up in demand in the country, where consumption tax cuts have unlocked pent-up buying during the festive season. The carmaker expects an all-round improvement in the coming months.
India passenger-vehicle sales for the quarter rose 10% to 144,397 units. The period also marked its highest-ever electric-vehicle contribution, with those models accounting for 17% of total car sales.
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