Tata Motors' JLR fears 1 billion pounds loss from Brexit: Report

Tata Motors-owned Jaguar Land Rover (JLR) has reportedly predicted an estimated 1 billion pounds loss by 2020 in the event of Britain's exit from the European Union (EU) in Thursday's referendum.

PTI| Last Updated: Jun 23, 2016, 08:49 AM IST
Tata Motors' JLR fears 1 billion pounds loss from Brexit: Report

London: Tata Motors-owned Jaguar Land Rover (JLR) has reportedly predicted an estimated 1 billion pounds loss by 2020 in the event of Britain's exit from the European Union (EU) in Thursday's referendum.

The luxury car firm, which has witnessed a major turnaround in its fortunes under the Tata Group's charge over the last few years, is believed to have conducted an internal analysis of the likely impact of Brexit, The Telegraph said.

The analysis expects the 1 billion pounds hit to come from a 10 percent levy on vehicles being exported to Europe and 4 percent on imports of components for the production of vehicles, the newspaper said.

A company spokesperson declined to give details, saying the study was for internal use only and that the company had analysed a variety of future scenarios.

However, the company's stance on referendum has been clearly in favour of remain in the run up to tomorrow's in-out referendum.

In a letter to JLR staff, company CEO Ralf Speth wrote that the automotive major was "convinced that we will be a stronger business - and a stronger country - if the UK remains a member of the European Union".

"If the UK was to leave the EU, it would become more difficult to buy components and sell our products in our largest market," he said.

Earlier, Ken Gregor, Chief Financial Officer (CFO) of JLR, had said in a joint statement with other colleagues from the UK's auto industry: "Remaining in the EU -- our largest market -- will increase Jaguar Land Rover's chances to grow, create jobs and attract investment in future technologies.

"Our European supply chain has been fundamental in helping us to meet customer expectations worldwide and achieve sustainable, profitable growth."

JLR's most recent annual results showed the company made 1.56 billion pounds pre-tax profit on revenues of 22.2 billion pounds.

Europe represented 24 percent of the total sales of 521,571 vehicles, making it the single biggest market for the company, ahead of the UK at 20 percent.