New Delhi: US President Donald Trump’s tariff offensive and softer domestic demand conditions weighed on Tata Motors’ performance during the April-June quarter of FY26, with the company reporting a 62.2 per cent drop in its consolidated net profit to ₹4,003 crore on Friday, compared to ₹10,587 crore in the same period last year.
“The company performance in this quarter was impacted by volume declines and a drop in profitability primarily at Jaguar Land Rover (JLR), affected by the US trade tariff impact where we had the full quarter of impact and then the trade alignment happened,” said Group CFO PB Balaji, who is set to take over as CEO of JLR from November this year.
“As tariff clarity emerges and the domestic festive demand picks up, we are aiming to accelerate our performance and rebuild momentum across the portfolio and deliver a strong second half performance,” he added.
The company reported a negative automotive free cash flow of ₹12,300 crore for the quarter, driven by adverse working capital impacts from seasonality and tariffs. Net automotive debt stood at ₹13,500 crore.
JLR’s slide
Wholesale volumes and revenues for Tata Motors’ luxury arm, JLR, were hit in the quarter by the imposition of 27.5 per cent US trade tariffs on UK- and EU-manufactured cars exported to the US, along with the planned phase-out of legacy Jaguar models ahead of new launches.According to the CFO, the US tariffs alone cost the business nearly £250 million in the quarter, as the deal announced on May 8 was ratified only on June 30. JLR reported a negative cash flow of £750 million, with a cash balance of £3.3 billion.
“The tariff impact will ease in the coming quarters from 27.5 per cent to 10 per cent as far as the UK is concerned and 27.5 per cent to 15 per cent as far as the EU is concerned. In light of this, our guidance for the FY26 EBIT margin of 5 per cent to 7 per cent remains and we will be near neutral cash flows,” Balaji said.
China’s recent luxury tax on imported vehicles is also impacting all of JLR’s products in the market. “We’re just rejigging our plans to take care of that.”
Commercial vehicles performance
Girish Wagh, Executive Director, Tata Motors noted that domestic sales volumes declined, reflecting broader market softness and delayed fleet replacement cycles, while segments such as buses and vans remained resilient. The company’s international business posted growth during the quarter.
CV wholesales stood at 88,000 units in Q1 FY26, down 6 per cent year-on-year, with domestic volumes declining 9 per cent and exports surging 68 per cent.
Holding a 36.1 per cent domestic market share for the quarter, the company is focusing on growth in the small commercial vehicle (SCV) category.
“The key point…
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