Jaguar Land Rover in for bumpy ride as profits fall despite stellar sales
The UK’s largest carmaker Jaguar Land Rover’s sales increased 28 per cent to 158,813 vehicles in the fourth quarter ended 31 March, thanks to a strong demand for the Jaguar XE compact saloon, nicknamed the “baby Jag”.
Despite reporting bumper sales, the British luxury car manufacturer saw its pre-tax profits fall to £1.56bn, down from £2.6bn a year earlier.
Jaguar Land Rover, which is owned by Indian conglomerate Tata, said sales in China recovered during the quarter, rising 19 per cent after dropping 10 per cent in the previous quarter.
Read more: Will Jaguar's first diesel SUV make the company sustainable?
Last year the company was forced to write off 6,000 vehicles after an explosion in the Chinese port of Tianjin caused £157m worth of damages.
Ralf Speth, chief executive, Jaguar Land Rover, said: “China is really coming back and that will also be the focus. I am cautiously optimistic that we can continue around the world with very nice sales and distribution.”
The company, that overtook Nissan last year to become Britain’s biggest carmaker, is set to invest £3.75bn this year to strengthen its technological capacity to manufacture models such as the Jaguar F-Pace and Range Rover Evoque Convertible.
Capital expenditure for Jaguar Land Rover is expected to be £3.75bn this fiscal year starting 1 April, up from £3.3bn last year.