Latest news with #RichardMolyneux
Time of India
11 hours ago
- Automotive
- Time of India
Tata's JLR slashes FY26 EBIT margin guidance to 5–6% on higher EV investment, product transition
Jaguar Land Rover (JLR), the UK-based luxury carmaker owned by Tata Motors , has significantly lowered its earnings before interest and tax (EBIT) margin guidance for FY26 to 5–6%, from the previously stated 10%, as it gears up for a year of high capital investment, model changeovers, and an accelerated push toward electrification. The revised outlook was shared as part of the company's Investor Day presentation on June 16, where top executives outlined their medium-term roadmap and strategic priorities. CEO Adrian Mardell described FY26 as a 'year of transformation,' driven by planned launches of new-generation vehicles and the start of production of key electric models. These developments, he said, will exert pressure on margins and cash flows in the short term but are essential to setting the business up for sustainable growth. The lower margin forecast is attributed to several overlapping factors—elevated capital expenditure, working capital outflows linked to model changeovers, and upfront costs related to electric vehicle (EV) manufacturing readiness across plants. The company expects capex to rise to £3.5 billion in FY26, compared to £3.2 billion in FY25. This spike will fund tooling, product development, and upgrades to manufacturing sites, including the Halewood plant, which is being converted into JLR's first all-electric facility. With its multi-architecture strategy encompassing MLA, EMA and the new JEA platforms, JLR is betting on a flexible approach to transition its portfolio. The first pure-electric Range Rover is expected to roll out in 2025, while an all-new electric Jaguar GT, built on the bespoke JEA architecture, will follow in 2026. Jaguar will become an electric-only brand by then, focusing on high-performance, low-roof GTs priced upwards of £100,000. Even as FY26 is expected to be a transition year, the company reiterated confidence in its long-term targets. By FY27, JLR aims to achieve EBIT margins of over 10%, free cash flows of more than £2 billion, and revenue per unit above £80,000, up from around £71,000 in FY25. The management views the current investment phase as a necessary step to unlock this future value. CFO Richard Molyneux said that despite the near-term margin compression, the business model is designed to generate operating leverage once the new models ramp up and premiumisation gathers pace. JLR's four-brand strategy—spanning Range Rover, Defender, Discovery and Jaguar—remains central to its premium positioning. The company is focused on developing unique identities, customer experiences, and design languages for each brand while continuing to drive average transaction values through special editions and bespoke offerings. Products like the Range Rover SV and Defender 130 have helped JLR increase pricing power, a trend the company expects to continue. Operationally, JLR ended FY25 on a strong note. Wholesales excluding the China JV grew by 25% to 401,000 units, while EBIT margins improved to 8.5% from 4.9% in the previous year. Net debt declined to £0.7 billion, and the company is on track to become net debt-free by the end of FY25. Liquidity stood at £5.3 billion, providing a buffer for the high-spend year ahead. While the FY26 guidance reset has tempered short-term investor expectations, analysts say JLR's strategic direction remains sound. The coming year will test the company's ability to execute on its product, EV, and brand strategies under tighter margins, but the broader narrative of transformation and premium-led growth remains intact.
Mint
11 hours ago
- Automotive
- Mint
JLR holds back revenue guidance, projects hit to profitability in FY26
Jaguar Land Rover Automotive PLC, the UK-based subsidiary of Tata Motors Ltd, did not give revenue guidance to its investors, even as it projected that operating profitability would suffer in 2025-26 due to US tariff hikes and a slowdown in the Chinese market. Tata Motors' shares went into a tailspin, falling 4% during trading hours on Monday after JLR's commentary. The company, which contributed 71% to its parent's total revenue and 79% to its total operating profit in 2024-25, has guided for operating profit margin in the range of 5-7%, which is lower than 8.4% it recorded in the last fiscal, as it would face higher tariffs in North America, its largest market. In its previous presentations to investors, it had projected that its operating profit margin would reach 10% by 2025-26. JLR is also projecting a hit to its free cash flow in the current fiscal year, which is expected to reach close to zero from £1.4 billion recorded in 2024-25. Its stated long-term vision is to reach a 15% operating profit margin. In 2024-25, its revenue fell 0.1% to £28.9 billion while profit after tax declined 30% to £1.8 billion. Retail sales declined 0.6% to 428,854 units. The luxury car maker's management expects to bounce back to the growth path in 2026-27 and 2027-28 after it adapts to the impact of the global macro environment. In March, US President Donald Trump announced the imposition of 25% tariffs on auto-related imports. Since JLR has plants in the UK and the European Union, it paused shipments to the US in April to assess the impact of the tariffs. While it got a partial relief after the US signed a free trade agreement with the UK in May, the outlook on tariffs from the EU still remains uncertain. Besides, even after the deal with the UK, the tariffs JLR will face in the US market are higher than what it previously faced on its exports. 'Where we stand today is that we'll pay a 300% increase on the tariffs we used to pay in the UK, so going from 2.5% to 10%. We'll also pay a 1,000% increase on the prior tariffs on Defender and Discovery out of our EU plant,' Richard Molyneux, chief financial officer at JLR, told investors during Tata Motors' post results earnings call on 13 May. Analysts have noted that JLR will likely see volume contraction in the current fiscal year, which will impact Tata Motors' consolidated earnings. 'JLR is facing multiple headwinds, which include tariff-led uncertainty for exports to the US, demand weakness in key regions like Europe and China, and rising VME (variable marketing expenses), warranty and emission costs,' analysts at Motilal Oswal Financial Services wrote in a 10 June note. Agreeing with the observations in the Motilal Oswal note, Raghunandhan NL, Manav Shah, and Rahul Kumar of Nuvama Institutional Equities said the path ahead for JLR appears to be difficult in the near term. 'In JLR, discontinuance of 'Jaguar' models, loss of market share in the China region and imposition of tariffs in the US region, shall lead to a volume contraction ahead,' the analysts wrote in a 10 June note. JLR decided in 2024 to discontinue all Jaguar models, including XE, XF, XF Sportwagon, and F-Type, barring one. It plans to make Jaguar an all-electric brand by 2026.
Economic Times
12 hours ago
- Automotive
- Economic Times
Tata's JLR slashes FY26 EBIT margin guidance to 5–6% on higher EV investment, product transition
Jaguar Land Rover, owned by Tata Motors, anticipates lower profit margins in fiscal year 2026. This is due to significant investments in electric vehicles and model upgrades. The company is converting its Halewood plant for EV production. JLR expects higher capital expenditure. Despite short-term challenges, JLR aims for improved margins and cash flow by fiscal year 2027. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Mumbai: Jaguar Land Rover (JLR), the UK-based luxury carmaker owned by Tata Motors , has significantly lowered its earnings before interest and tax (EBIT) margin guidance for FY26 to 5–6%, from the previously stated 10%, as it gears up for a year of high capital investment, model changeovers, and an accelerated push toward electrification. The revised outlook was shared as part of the company's Investor Day presentation on June 16, where top executives outlined their medium-term roadmap and strategic Adrian Mardell described FY26 as a 'year of transformation,' driven by planned launches of new-generation vehicles and the start of production of key electric models. These developments, he said, will exert pressure on margins and cash flows in the short term but are essential to setting the business up for sustainable growth. The lower margin forecast is attributed to several overlapping factors—elevated capital expenditure, working capital outflows linked to model changeovers, and upfront costs related to electric vehicle (EV) manufacturing readiness across company expects capex to rise to £3.5 billion in FY26, compared to £3.2 billion in FY25. This spike will fund tooling, product development, and upgrades to manufacturing sites, including the Halewood plant, which is being converted into JLR's first all-electric facility. With its multi-architecture strategy encompassing MLA, EMA and the new JEA platforms, JLR is betting on a flexible approach to transition its first pure-electric Range Rover is expected to roll out in 2025, while an all-new electric Jaguar GT, built on the bespoke JEA architecture, will follow in 2026. Jaguar will become an electric-only brand by then, focusing on high-performance, low-roof GTs priced upwards of £100, as FY26 is expected to be a transition year, the company reiterated confidence in its long-term targets. By FY27, JLR aims to achieve EBIT margins of over 10%, free cash flows of more than £2 billion, and revenue per unit above £80,000, up from around £71,000 in FY25. The management views the current investment phase as a necessary step to unlock this future value. CFO Richard Molyneux said that despite the near-term margin compression, the business model is designed to generate operating leverage once the new models ramp up and premiumisation gathers four-brand strategy—spanning Range Rover, Defender, Discovery and Jaguar—remains central to its premium positioning. The company is focused on developing unique identities, customer experiences, and design languages for each brand while continuing to drive average transaction values through special editions and bespoke offerings. Products like the Range Rover SV and Defender 130 have helped JLR increase pricing power, a trend the company expects to JLR ended FY25 on a strong note. Wholesales excluding the China JV grew by 25% to 401,000 units, while EBIT margins improved to 8.5% from 4.9% in the previous year. Net debt declined to £0.7 billion, and the company is on track to become net debt-free by the end of FY25. Liquidity stood at £5.3 billion, providing a buffer for the high-spend year the FY26 guidance reset has tempered short-term investor expectations, analysts say JLR's strategic direction remains sound. The coming year will test the company's ability to execute on its product, EV, and brand strategies under tighter margins, but the broader narrative of transformation and premium-led growth remains intact.
Time of India
12 hours ago
- Automotive
- Time of India
Tata's JLR slashes FY26 EBIT margin guidance to 5–6% on higher EV investment, product transition
Mumbai: Jaguar Land Rover (JLR), the UK-based luxury carmaker owned by Tata Motors , has significantly lowered its earnings before interest and tax (EBIT) margin guidance for FY26 to 5–6%, from the previously stated 10%, as it gears up for a year of high capital investment, model changeovers, and an accelerated push toward electrification. The revised outlook was shared as part of the company's Investor Day presentation on June 16, where top executives outlined their medium-term roadmap and strategic priorities. CEO Adrian Mardell described FY26 as a 'year of transformation,' driven by planned launches of new-generation vehicles and the start of production of key electric models. These developments, he said, will exert pressure on margins and cash flows in the short term but are essential to setting the business up for sustainable growth. The lower margin forecast is attributed to several overlapping factors—elevated capital expenditure, working capital outflows linked to model changeovers, and upfront costs related to electric vehicle (EV) manufacturing readiness across plants. Also Read: Tata Motors shares fall 5% after JLR projects flat cashflow and lower FY26 margins by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Play War Thunder now for free War Thunder Play Now Undo The company expects capex to rise to £3.5 billion in FY26, compared to £3.2 billion in FY25. This spike will fund tooling, product development, and upgrades to manufacturing sites, including the Halewood plant, which is being converted into JLR's first all-electric facility. With its multi-architecture strategy encompassing MLA, EMA and the new JEA platforms, JLR is betting on a flexible approach to transition its portfolio. The first pure-electric Range Rover is expected to roll out in 2025, while an all-new electric Jaguar GT, built on the bespoke JEA architecture, will follow in 2026. Jaguar will become an electric-only brand by then, focusing on high-performance, low-roof GTs priced upwards of £100,000. Live Events Even as FY26 is expected to be a transition year, the company reiterated confidence in its long-term targets. By FY27, JLR aims to achieve EBIT margins of over 10%, free cash flows of more than £2 billion, and revenue per unit above £80,000, up from around £71,000 in FY25. The management views the current investment phase as a necessary step to unlock this future value. CFO Richard Molyneux said that despite the near-term margin compression, the business model is designed to generate operating leverage once the new models ramp up and premiumisation gathers pace. JLR's four-brand strategy—spanning Range Rover, Defender, Discovery and Jaguar—remains central to its premium positioning. The company is focused on developing unique identities, customer experiences, and design languages for each brand while continuing to drive average transaction values through special editions and bespoke offerings. Products like the Range Rover SV and Defender 130 have helped JLR increase pricing power, a trend the company expects to continue. Operationally, JLR ended FY25 on a strong note. Wholesales excluding the China JV grew by 25% to 401,000 units, while EBIT margins improved to 8.5% from 4.9% in the previous year. Net debt declined to £0.7 billion, and the company is on track to become net debt-free by the end of FY25. Liquidity stood at £5.3 billion, providing a buffer for the high-spend year ahead. While the FY26 guidance reset has tempered short-term investor expectations, analysts say JLR's strategic direction remains sound. The coming year will test the company's ability to execute on its product, EV, and brand strategies under tighter margins, but the broader narrative of transformation and premium-led growth remains intact.
Hindustan Times
19-05-2025
- Automotive
- Hindustan Times
Defender prices to drop by 50%? How India-UK FTA will affect prices
JLR commenced local assembly of the Range Rover LWB and Range Rover Sport last year, while it has been assembling the Discovery, Discovery Sport, Range Rover Evoque and Velar in India for a while now Check Offers The recently concluded India-UK Free-Trade Agreement (FTA) will have a major impact on the economies of both nations, but prices for the Range Rover and Defender models won't see a major drop as the Internet will have you believe. The India-UK FTA is expected to bring the taxation down from over 100 per cent to just 10 per cent. However, JLR's global best seller are already in made in India and that means, there is likely going to be little change in prices. Here's how. JLR commenced local assembly of the Range Rover LWB and Range Rover Sport last year, while it has been assembling the Discovery, Discovery Sport, Range Rover Evoque and Velar in India for a while now. With the models already being assembled here, it will see no change in prices for the range. On the other, the Defender, JLR's top-selling model in India will not see a change in pricing, despite bring a full import. The Defender is made at the brand's Nitra manufacturing plant in Slovakia, and not in the UK. Under the India-UK FTA, products covered under exemption are those built in either countries. Given the Defender's Slovakian origins, the model will see no impact on the pricing. Also Read : Defender Octa, the toughest Defender ever, launched in India That being said, rumours are rife that the Defender is next to begin local assembly in the country. JLR's Chief Financial Officer, Richard Molyneux, confirmed recently during an earnings call that local assembly for the Defender in India is in the works. However, the company is yet to officially announce plans or timelines for the same. We have reached out to JLR for a statement on the same, and will update this piece as and when the company responds. That being said, the Defender's local assembly won't bring down prices by 50 per cent either. It will, however, get more affordable by about 20 per cent, similar to how Range Rover prices dropped last year. (Please interlink RR price drop story here) The Defender is currently priced between ₹ 1.05 crore and ₹ 2.79 crore (ex-showroom) and is available in three body styles - 90 (3-door), 110 (5-door), and 130 (5-door extra long). Should the local assembly begin, expect starting prices to hover around the ₹ 85 lakh mark. But a timeline for the local assembly is yet to be ascertained. Also Read : JLR India sales jump 36% in H1 FY2025 as local assembly strategy pays off For JLR and buyers, the local assembly strategy works out better. The model is more readily available since the dependence on global allocations is lesser. Moreover, the fluctuating foreign exchange has a lesser impact on overall prices. The move also opens room for more opportunities to vendors, suppliers, and labour in the country, making it a more fruitful strategy in the long term. JLR is already reaping benefits of this strategy with the larger Range Rovers. The company registered a 40 per cent year-on-year hike in sales in FY2025, retailing 6,183 units, its highest-ever in India. Defender sales witnessed a spike by 90 per cent, while the Range Rover and Range Rover Sport grew by 72 per cent and 42 per cent, respectively. The record sales helped JLR move up to the third spot in the Indian luxury sales market, behind Mercedes-Benz and BMW, pushing Audi to fourth. Check out Upcoming Cars in India 2024, Best SUVs in India. First Published Date: 19 May 2025, 17:25 PM IST
