British car maker Jaguar Land Rover has lowered its forecast for FY26 earnings before interest and taxes margins to 5-7 per cent from 10 per cent earlier, amid uncertainty in the global auto industry and looming US duties. Shares of parent Tata Motors slumped as much as 5.2 per cent in early trade following the announcement.
The revised EBIT margin forecast is also below JLR’s reported 8.5 per cent margin for the previous fiscal year.
JLR added it sees free cash flow of close to zero in fiscal 2026. The company, which derives over a quarter of its sales from the US, had temporarily paused shipments to the country after President Donald Trump slapped a 25 per cent duty on all foreign-made vehicles sold in the world’s second-largest car market.
It is reallocating units to “accessible markets” to boost profits. It added that it continues to engage with the US and UK governments regarding a trade deal signed in May, which allows the UK to export 100,000 cars a year to the US at a 10 per cent tariff, below the 25 per cent levy for other nations.
While JLR’s Range Rover SUV lineup is manufactured in the UK, the “Defender” is made in Slovakia, which does not yet have a trade pact with the Trump administration.
The car maker said it is assessing pricing in the US to help offset the tariff impact. Analysts have said JLR may be less affected by the increased costs associated with the tariffs, thanks to a wealthier customer base.
