Tata Motors Struggling

Tata Motors Struggling

Shares of the Indian auto company, Tata Motors, have recently slipped by over 4 percent. The market did not look good for the company as the first quarter earnings were looking worse than before.

The Indian auto manufacturer reported this Thursday that the net profits for this year were consolidated. Tata Motors sales record has been pretty much the same for many years, but recently the input of costs has risen considerable and sales have been slower due to the rising prices of the vehicles in India.

Tatas first quarter this year showed that sales had gone down from 14 percent to 13 percent in the space of a year. Tata Motors received a downgrading from the CLSA brokerage house. The rating first stood at “outperform” but has now been moved to “underperform.

The sales for Tata remained reasonable in the beginning of the year, but now it seems to be slowing down. Possibly due to raised fuel prices, the high rates for loans, and more competition than in recent years.
Commercial sales did rise by 13 percent in passenger sales, compared to last year. Fiat, Land Rover, and Jaguar also suffered a drop in their Indian sales, by over 10 percent.

Many are beginning to worry that this could begin to spread throughout Europe via countries such as Greece. The market slow down is expected to spread other auto companies and to other parts of the world.

The situation for these companies in the United States is also looking worse than ever before. Because a large chunk of these companies income does come from exports and expanding further to new countries, this could mean big trouble. Overseas business has been slowing for all businesses, but especially in the auto industry.

Tata announced that that its sales had seen a decline, and particularly its overseas sales. At the same time last year, the company’s sales record stood at around 90,702, but this year at a one percent decline the record stood at just 89,846.

However Tata Motors has said that it is excelling in the sales of the luxurious Jaguar Land Rover brands. This brand actually increased sales since last year at the same time by one percent. The company sold around 20,350 automobiles in its luxury JLR range, and Land Rover had an increase of a whopping 22 percent in sales. Why these automobiles have been doing so much better than the others is not clear.

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