Addressing shareholders in the company’s 2021-22 Annual Report, he said the company’s three independent business units – Commercial Vehicles, Passenger Vehicles and Jaguar Land Rover – are self-sufficient and the automaker is confident that it will achieve zero net worth by FY24. Close to automotive loans.
“Recent history has been relentless with global pandemics, military conflicts, rising inequality, supply chain constraints and much more. Decades of experience have been squeezed into two dizzying years. This unprecedented sequence of events spurs businesses with speed and agility. Has suffered,” Chandrasekaran wrote.
He cited supply chain issues and runaway commodity inflation as the major hurdles among the many challenges.
“While the near-term outlook is fluid with many of the challenges that I outlined above, the business is taking the right actions to navigate them, and I am confident that we will emerge stronger,” the chairman said.
Stating that Tata Motors is “taking concrete actions to be future-ready and create a good cycle of growth and returns for our shareholders”, he said, “I would like to welcome you on this journey. “
Despite supply chain issues and runaway commodity inflation impacting margins, he said, “Our India business ended with strong free cash flow 1,879 crores. We remain committed to restoring the profitability of this business as it returns to competitive growth and inflation stabilizes.”
The Tata Motors group now operating as three independent business units of commercial vehicles, passenger vehicles and Jaguar Land Rover said it has leveraged backend and corporate synergies wherever possible to differentiate its various customer segments. Different value propositions are offered.
Chandrasekaran said, “This has made Tata Motors lean, agile and customer-centric. Each of these businesses is self-sustaining, which gives me confidence that we will achieve zero net automotive debt by FY24.”
Looking beyond the near-term challenges, he said, “Jaguar Land Rover is in a strong position with a portfolio of attractive premium luxury products, a healthy customer order bank, low break-even, and the right to support its distinctive A future-ready strategy. And a well-known British brand in a rapidly changing legislative and commercial landscape.”
Chandrasekaran said the global shortage of semiconductors has had an adverse impact on JLR’s production and sales as compared to its competitors. “Even though we have taken various steps to address this issue, the situation remains challenging. This is an important issue facing Jaguar Land Rover and we are working hard to resolve it during FY23. The gradual improvement in performance should be aided over the years,” he said.
On the JLR outlook, Tata Motors said the new Range Rover Sport model changeover along with the COVID-19 lockdown in China is expected to limit the volume improvement in the first quarter of FY13, with the company expecting volumes thereafter. and “we aim to achieve a 5 percent EBIT margin and positive free cash flow of (exceeding) £1 billion in fiscal 2013.”
On the passenger vehicles business outlook, the domestic auto major said that the vertical expects strong improvement in margins and profitability in FY13 and the company will continue to have strong sales performance with improving profitability and managing supply constraints.
It added that the PV business will continue to launch new products and increase capacity to meet the growing demand, adding that despite significant steps in investment, the business is expected to remain self-sustaining.
For commercial vehicles (CVs), Tata Motors said the industry is poised for further growth due to increase in expenditure on road construction, mining and better infrastructure. The supply position is showing gradual improvement.
Despite the uncertainties, business sentiment remains positive with increased fleet utilization levels and freight rates.
However, rapid commodity inflation remains a challenge.
The company said it will continue to increase its investments in products and new business models to deliver value to customers while ensuring profitable growth.
“Despite near-term supply challenges and inflation concerns, the business aims to deliver strong margin recovery and profitability in FY23,” it added.
Girish Wagh, Executive Director, Tata Motors said that in FY22, unprecedented commodity inflation impacted CV business margins and the company has stepped up and accelerated cost reduction efforts, by reviewing every cost element and taking pricing action. , responded to the challenge towards improving profitability. Improving profitability is a key priority.
Reiterating Tata Motor Group’s commitment to sustainable mobility, Chandrasekaran said that this change is irreversible and the company will be one of the leaders of green mobility globally as it grows by 2039 for JLR, 2040 for PV and 2045 for CV. target of net-zero emissions.
“Action is already underway to distribute it,” he informed company members.
Chandrasekaran said that in India, EV penetration in the company’s portfolio is likely to increase to 25 per cent in five years, from 7.4 per cent in Q4 FY22. He said that by 2025, Tata Motors will have 10 electric vehicles.
This story has been published without modification in text from a wire agency feed. Only the title has been changed.