Tata Motors stock slips, day after JLR chief warns of losses over Brexit

Last Updated: Wed, Sep 12, 2018 16:01 hrs
JLR CEO - Ralf Speth

Stocks of Tata Motors on Wednesday slipped by as much as 3% in intra-day trading on the Bombay Stock Exchange.

At the end of close of business hours on Wednesday, stocks ended at 261.90 per share, 1.98% or 5.30 points lower from the opening.

The impact was seen after the Chief at Tata's Jaguar Land Rover (JLR) issued a warning to the UK government of massive losses in the event Britain left the European Union (EU).

The UK's largest carmaker has witnessed a complete turnaround in its fortunes since, Tata Motors acquired the traditional British brands from Ford 10 years ago.

JLR's CEO Ralf Speth, speaking at a summit- Zero Emission Vehicle Summit in Birmingham on Tuesday said that fears of a so-called "no-deal" Brexit and lack of clarity over Britain's post-Brexit plans threatened the UK-based luxury carmaker's entire operational set up.

"Just one part missing could mean stopping production at a cost of 60 million pounds a day. That is a huge risk. We depend on free, frictionless, seamless logistics," he said.

Back in July, the JLR CEO had issued a similar statement warning the UK government against a "bad Brexit deal".

How important is JLR to manufacturing in Britain?

In a blog posted on Tata's Europe section dated 2015, Ralf Speth answers a question on the importance of JLR to manufacturing in Britain and to the British economy in general.

Speth answers, "As the United Kingdom's largest manufacturing investor, JLR is crucial to the renaissance of British industry." "We have committed £10 billion over the last five years to product creation and infrastructure investment." "Much of this has centred on significantly upgrading our manufacturing plants and establishing a centre of excellence for engine manufacturing. With such investment comes a significant number of jobs, demonstrating our commitment to advancing the capability of the country's automotive sector and its supply chain." "We support roughly 200,000 families across the United Kingdom, when we take into account jobs at suppliers as well."