Tata Motors anticipates relief for its luxury arm, Jaguar Land Rover (JLR), from recent U.S.-UK and India-UK trade agreements, though financial benefits remain uncertain. Group CFO P B Balaji, speaking during the Q4 FY25 earnings call, said the company awaits detailed terms to assess the impact of tariff changes.
The U.S.-UK deal lowers tariffs on British car exports to the U.S. from 25% to 10%, offering partial relief after JLR halted U.S. shipments last month due to high duties. However, the 10% rate exceeds the prior 2.5%, prompting JLR to intensify cost-saving measures. Balaji noted that retrospective application of the lower tariff could offset losses from the shipment pause, with clarity expected within a month.
The India-UK Free Trade Agreement (FTA) slashes import duties on UK-built cars from over 100% to 10%. While current Range Rover models, assembled locally via CKD, are unaffected, the FTA enables more competitive pricing for future JLR launches. “This allows us to offer global cars at global prices,” Balaji said, noting that decisions on expanding local production depend on final FTA details.
Jaguar GT and Range Rover EV Drive Excitement
JLR’s product pipeline is fueling optimism. The Jaguar Type 00, a bold step in the brand’s electric performance revival, is on a global reveal tour, visiting Monaco, Berlin, Tokyo, Amsterdam, and Mumbai. Over 32,000 expressions of interest highlight strong demand.
The Range Rover Electric, nearing launch after completing winter testing in Sweden, has a waitlist exceeding 61,000 vehicles, signaling robust market appetite.
Cost Discipline Remains Key
Amid global economic uncertainty, Balaji emphasized rigorous cost control. “We’re closely monitoring costs and cash flows while investing in future-ready products,” he said, citing material costs and warranty expenses as focus areas.
Analysts foresee short-term U.S. challenges due to tariff uncertainty but remain optimistic about JLR’s long-term prospects, particularly in India, where lower duties and growing luxury vehicle demand could unlock significant growth.