Jaguar Land Rover annual profit plunges 99% on US tariffs, cyberattack

Jaguar Land Rover’s annual profits slumped more than 99% after the British carmaker absorbed the impact of US tariffs and a cyber-attack that disrupted its factories for months.

Britain’s largest carmaker reported a profit before tax and exceptional items of only £14m in the year to March, compared with £2.5bn a year earlier, according to financial results published Thursday.

The manufacturer, which employs 33,000 people in the UK, faced a series of setbacks as Donald Trump’s automotive industry tariffs disrupted its important export market.

A damaging cyber-attack on Aug. 31 forced the company to shut down most systems and factories for weeks, with disruptions continuing through the autumn.

Trump raised tariffs to 25% before agreeing on a 10% rate for the UK, which hurt US demand for JLR’s luxury cars, and the subsequent cyber-attack halted supply. Revenue fell to £22.9bn, down more than a fifth from the previous 12 months.

JLR also said sales were hit by competition in China, where a large number of carmakers are introducing new products.

JLR was not alone in struggling with tough conditions. Japanese manufacturer Honda on Thursday reported its first annual loss in 70 years as a listed company.

Honda wrote off 1.6tn yen (£7.4bn) in electric car investments after Trump removed subsidies for battery vehicles, pushing it to a loss of 423bn yen.

PB Balaji, who became chief executive of JLR a few weeks after the hack, said: “JLR faced a challenging year with revenue and profit affected by multiple headwinds, including a pause in production following the cyber incident.”

However, he said the company “ended well” and had “come back resiliently”.

Balaji added that in the second half of this year JLR would launch the delayed Range Rover Electric, as well as showing the first smaller electric SUVs and its new Jaguar EV, the Type 01. The electric Range Rover had been planned for 2025 but was postponed amid weaker-than-expected demand.

Balaji declined to comment on Britain’s political turmoil, but said it was crucial the government reached an agreement with the EU to include UK carmakers in any new “Made in Europe” rules. The rules, designed to protect European industry from Chinese competition, could lock British carmakers out of EU incentives for EVs, putting them at a post-Brexit disadvantage.

“The challenges would be significant for the UK as well as EU [manufacturers] if we do not come up with a solution,” Balaji said.

JLR makes its Range Rover and forthcoming Jaguar models in Solihull, West Midlands, and produces smaller SUVs such as the Discovery Sport in Halewood, Merseyside. Those models would be affected by proposals to limit company cars to those made in the EU.

The steep costs of the cyber-attack and investments in new models meant the carmaker burned through £2.2bn of cash for the full year. However, JLR said it remained “resilient and well placed to address the geopolitical, inflationary and regulatory challenges the industry faces”, with £6.9bn of available funds.