Tata Motors set for a mixed performance in Q4 amid heightened competition

The company’s passenger and commercial vehicle sales are falling, and its British crown jewel, Jaguar Land Rover, is facing the threat of increased tariffs from the US. 

What was its fiefdom even a couple of years back is now being challenged by increasing competition in electric vehicle space from companies such as JSW MG Motor India Private Ltd, Mahindra and Mahindra Ltd, and Hyundai Motor India Ltd.

The market share of Tata Motors in the electric car segment declined from 73.5% in March 2024 to 38.3% in March 2025, as per a 2 April note by Choice Equity Broking. 

In the overall passenger vehicle market, Tata Motors is ceding ground to Mahindra which overtook the company to reach second position in the overall car market in April 2025. 

Total passenger vehicle sales during the period declined by 6% to 146,999 units from 155,651 units in the year ago period. Commercial vehicle sales saw a 3% decline to 105,643 units from 109,439 units in the same period last year.

Chandresekaran, who chairs the board of Tata Motors, may face some tough questions. One of them being, how do they plan to win growth back?

Jaguar Land Rover, which contributed 69% to Tata Motors’ overall profit in FY24, is also facing headwinds in North America where things were looking bright in the last few months. 

In the January to March period, the company was able to record a 14.4% jump in volumes in the North America region. However, the dream run may soon end. 

In the first month of fiscal 2026, JLR did not export any vehicles to the US. It decided to resume exports in May. The firm may get partial benefits due to the reduction in tariffs owing to the US-UK trade agreement. 

However, with tariff relief capped for 100,000 vehicles a year for all the players from the UK, the benefit might not be too much for Tata Motors’ international subsidiary.

In this backdrop, Mint highlights five things which will be key to watch when the company, which will complete 80 years of operations soon, announces its earnings for the January- March period on Tuesday, 13 May. 

Tata Motors’ revenue

According to an average of three analyst estimates, the company revenue during the last quarter of financial year 2025 would grow by 2.7% to ₹1.22 trillion. 

However, the company might face challenges on the margin front. “Tata Motors is likely to witness a margin contraction of 120bps YoY, led by global headwinds impacting the JLR segment,” analysts at Elara Capital wrote in a 14 April note. Ebitda (earnings before interest, taxes, depreciation, and amortisation) margin in Q4 FY24 was at 14.2%. 

Also Read: Tata Motors says it’s confident of maintaining EV leadership. Can it?

Muted profit

According to the average of three analyst estimates, Tata Motors’ profitability may grow marginally by 1% to reach ₹7,800 crore. The growth is adjusted for a one-time ₹8,300 crore deferred tax asset it recognised in Q4 of the financial year 2024, which had boosted its profit to ₹17,500 crore.

The consolidated profit will be helped by the delay in adoption of electric vehicles platforms for Jaguar Land Rover. “JLR Ebit margin to be 10.3% on better operating leverage and continuing lower depreciation as the company extends its current platforms on delay of EV plans,” analysts at HDFC Securities wrote in an 11 April note.

EV plans

With competitors closing in on the company’s leadership in the electric vehicle segment, management’s commentary on how it will manage to protect its turf will be closely watched. 

In the January to March period, its electric vehicle sales in the international and domestic markets declined by 23% to 15,936 units. 

With new launches from Maruti Suzuki in the current fiscal, the market is about to get tougher for the EV leader.  

Commentary on the transition of the Jaguar’s transition to an all electric positioning will also be closely watched. In a meeting with analysts in March, the management of Tata Motors had flagged concerns about a slowdown in the global electric vehicle market which may force the company to extend the life of its internal combustion engine platform. 

Also Read: Tata Motors considers new ICE models as EV adoption slows, competition intensifies

Outlook on demand

Maruti Suzuki had flagged a slowdown in the country’s car market, but Mahindra and Mahindra remained upbeat about customer sentiment. 

Now investors will closely watch the commentary of Tata Motors’ management on its take on the car market as the industry expects a meagre 1-2% growth in the current financial year. 

Tata Motors is also facing a slowdown in the commercial vehicle market where competition is about to increase after Mahindra’s acquisition of SML Isuzu. The Mahindra-SML combination is eyeing more than 10% share in the trucks and bus market in the next five years, which will challenge growth of Tata Motors as well. 

Headwinds for JLR

Biggest contributor to Tata Motors profit, JLR is facing multiple headwinds. Its sales fell nearly 30% in the Chinese market during the last quarter but Europe and North America remained strong.

However, US President Donald Trump’s decision to impose a 25% tariff on all auto imports has the potential to jeopardize growth for JLR. North America constituted the second highest share of its sales at 94,994 units of its total 431,733 units in the financial year 2024. 

Although a trade deal between the UK and US has the potential to ease some pain as tariffs were reduced to 10% for 100,000 vehicles imported from the UK, the prospects of growth in the American market have been severely limited. 

Management’s plan to navigate the headwinds will be a key thing to track during the post results earnings call.

On Monday, shares of Tata Motors ended 1.5% higher on the National Stock Exchange at ₹719.70 in a strong market. 

Also Read: Electric bus makers Tata Motors, PMI Elctro, JBM Auto set for a joyride as Delhi eyes full fleet electrification