Jaguar Land Rover proprietor Tata Motors reported a wider-than-estimated first-quarter loss as a world semiconductor scarcity dragged down gross sales on the UK luxurious unit.

Tata Motors reported a lack of 44.5 billion rupees ($598 million) within the three months ended June 30, in comparison with an 84.4-billion-rupee shortfall a 12 months earlier, the company said. Analysts had forecast a 21-billion-rupee loss, in line with the typical of estimates compiled by Bloomberg.

JLR reported a income of 4.97 billion kilos ($6.9 billion). The corporate mentioned its business automobile demand was exhibiting a gradual enchancment.

Uncooked materials prices for Tata Motors jumped to 373.1 billion rupees within the newest quarter in comparison with 99.4 billion rupees in the identical interval final 12 months.

“JLR now expects semiconductor provide shortages within the second quarter to be higher than within the first quarter, probably leading to wholesale volumes about 50 p.c decrease than deliberate,” Tata mentioned in a press release. “Within the second quarter, JLR expects a adverse EBIT margin with a free money outflow of lower than £1 billion. JLR expects the scenario will begin to enhance within the second half of the monetary 12 months.”

Earlier this month, Jaguar Land Rover warned deliveries within the second quarter might be 50 p.c worse than anticipated as a world chip scarcity exhibits no signal of abating.

The chip disaster compelled the luxurious automaker to briefly droop manufacturing at its Fortress Bromwich and Halewood vegetation.

Jaguar Land Rover’s efficiency is essential for Mumbai-based conglomerate Tata Group, after a devastating wave of COVID-19 infections and government-imposed lockdowns crimped demand in its house market.

Jaguar Land Rover is working with suppliers and chip producers to extend the visibility and the management of chip provide for its automobiles, Chief Monetary Officer Adrian Mardell mentioned in an investor name earlier this month. It is also prioritizing manufacturing of higher-margin automobiles and seeking to change options on automobiles. That mentioned, the automaker just isn’t anticipating the chip scarcity to delay any “important” launches, Mardell mentioned.

Underneath CEO Thierry Bollore, the previous Renault chief who joined the UK automaker in September, Jaguar Land Rover can be planning to affect its lineup and ditch combustion engines fully in 4 years, a transfer that may essentially imply the next reliance on extra superior semiconductors.

Land Rover line will get its first full-electric mannequin in 2024, and by the next 12 months, all Jaguars might be solely powered by batteries.