Tata cars for impact, as Jaguar Land Rover shipping to the US holds | Mint

New -Delhi: Tata Motors Ltd’s decision to make Jaguar Land Rover (JLR) cars wait for the US for April for April, raises concern for both the company’s volumes and financial performance in this financial year, as well as for the broader Indian car sector that the country considers to be a major export market. On March 26, US President Donald Trump announced a 25% duty on all cars and car parts imported in the US. Since the announcement, Tata shares have dropped by more than 13% from Friday’s closure, compared to a drop of more than 5% in the BSE Auto index. The North American region – including the US and Canada – which was more than a fifth of the total sales volume of JLR in fiscal 2024 in the January to March of 2024, was the largest retail market for the brand. The region accounted for 15% of the consolidated revenue of Tata Motors of £ 4.37 trillion in FY24, and JLR as a brand covered 69% of revenue. To be sure, JLR exports to the US, mainly from its Solihuell plant in the United Kingdom. “The US is an important market for JLR’s luxury brands,” the company said in a statement on April 5. “As we work to address the new trading conditions with our business partners, we take in our planned short-term actions, including a shipping in April, while developing our plans for the middle to longer term.” No sales in April for JLR in its largest market in the first month of the new financial year, according to two analysts, implies poorer growth in the full year for the business. “The problem for Tata Motors is that JLR faces the wind in Europe and China. North American market looked strong, but with this decision in the first month, there could be a serious impact on the business,” said Sanket Kelascar, Analyst of Shares Research at Ashika Group. “In the near term, the risk of a hit for the volumes of the business exists as a result of this decision, which leads to poorer growth,” says Saji John, senior research analyst at Geojit Financial Services. “But the situation remains volatile, so it has yet to be seen how the company will tackle Trump’s rates.” The British luxury car church was 69% of the total revenue of Tata Motors in the financial year 2024. In the October to December period, the share of the trademark in revenue and profit before the tax of Tata Motors nearly three fourth. The Mumbai company bought the UK brand for $ 2.3 billion in 2008 in an agreement that enabled the international car markets. The impact meanwhile, analysts also expect the impact on component players such as Sona BLW Precision Forks Ltd, Bharat Forge Ltd and Samvardhana Motherson International Ltd, which gets a significant part of the US revenue. CLSA already has the Tata Motors stock from ‘high conviction better than a performance’ to ‘better perform’ due to the impact on JLR following the announcement of the US administration on April 2. The target price was reduced from £ 930 to RS765. “We believe that the imposition of 25% car import tariffs in the US, together with the cessation of Jaguar models, will result in JLR volumes falling on FY26 14%,” Clsa analysts said. Some analysts note that there is a possibility of recycling the company’s stock in the coming days due to the impact of the latest decision by JLR. Last year, the company made the decision to discontinue all Jaguar models such as XE, XF, XF Sportwagon and F-Type, which impeded one. JLR plans to make Jaguar an all-electric brand by 2025. In FY24, Jaguar sells 12.437 units in the Northern America region or about 11% of JLR’s total sales in the region. At an analyst meeting held in March, the management of Tata Motors suggested that the North American market is still a strong growth driver. “The US market is holding well with some signs of recovery in the EU. The company expects strong growth to continue in the short term,” analysts at ICICI Securities wrote in an A12 March note. However, the possibility of rates has already acted as a factor of uncertainty for the business, according to multiple analysts to the meeting. “Uncertainty about the impact of tariff barriers continues, and the company will wait to determine if any material changes are needed to its current business model,” analysts at Motilal Oswal wrote in an March 11 note. This comes at a time when Tata Motors faces a difficult car market in India, as it achieved sales of 556,000 units in the financial year 2025 compared to 573,000 units in the previous fiscal, a 3%drop.