JLR delivers 11th successive profitable quarter
Source: The Business Desk - Neil Hodgson
Luxury car maker, Jaguar Land Rover, delivered its 11th successive profitable quarter in the three months ended June 30, 2025 – but it suffered a hit to its bottom line due to US President Donald Trump’s new tariff quotas.
First quarter revenues for the company, which has manufacturing plants in Halewood, Merseyside, and at Castle Bromwich and Solihull in the West Midlands, were £6.6bn, down 9.2% versus Q1 FY25.
Wholesale volumes and revenues in the quarter were impacted by the application of 27.5% US trade tariffs on UK- and EU‑produced cars exported to the US, and the planned wind-down of legacy Jaguar vehicles ahead of the launch of new Jaguar electric vehicles.
US trade tariffs also had a direct and material impact on profitability and cash flow in the period, the group said.
In April JLR paused exports to is US market for almost a month due to uncertainty over the tariff crackdown.
On May 8, 2025, JLR welcomed the positive announcement of a UK‑US trade deal which reduces tariffs on UK auto exports to the US from 27.5% to 10%, within a quota of 100,000 UK vehicle exports per annum.
It said this trade deal will reduce the significant financial impact of US tariffs going forward.
On July 27, 2025, an EU‑US trade deal was announced, which will reduce US tariffs on EU‑produced vehicles exported to the US from 27.5% to 15%. In due course, this trade deal will also reduce the financial impact of US tariffs on JLR’s business.
Profit before tax and exceptional items in the quarter was £351m, down from £693m a year ago, with EBIT margin at four per cent.
Profit after tax in the quarter was £248m, compared with £502m in the same quarter a year ago.
The decrease in profitability year‑on‑year was impacted by the introduction of US tariffs and foreign exchange headwinds in the period.
Free cash flow for the quarter was a deficit of £758m, with a closing cash balance of £3.3bn.
Additionally, an annual dividend of £448m was paid to the Indian parent company, TML Holdings.
Total liquidity was £5bn, including the £1.7bn undrawn revolving credit facility.
Looking ahead, the group said it remains focused on delivering its Reimagine Strategy and expects investment spend to remain at £18bn over the five‑year period starting in 2024, funded by operating cash flows.
Guidance for the 26 financial year remains unchanged, with EBIT margin in the range of five per cent to seven per cent, improving year‑on‑year for FY27 and FY28, and with FY26 free cash flow close to zero.
CEO, Adrian Mardell, said: “Thanks to our talented people and the robust foundations we have built at JLR, we delivered an 11th successive profitable quarter amid challenging global economic conditions.
“We are grateful to the UK and US Governments for delivering at speed the new UK‑US trade deal, which will lessen the significant US tariff impact in subsequent quarters, as will, in due course, the EU‑US trade deal announced on 27 July 2025.
“Looking ahead, we remain focused on delivering our transformational Reimagine Strategy, including investing £3.8bn this financial year to support the development of our next generation vehicles, including our stunning new electric Range Rover and Jaguar models.”
Earlier this month Mr Mardell announced he will be stepping down after three years as CEO and 35 years with the group.
He will be replaced by Mr PB Balaji who has been serving as group chief financial officer of the Tata Motors Group since November 2017 and has 32 years of experience in the automotive and consumer goods industries across finance and supply chain functions.