Tata Motors has insisted it has no intention of selling Jaguar Land Rover, despite a breakdown in talks with the government over taxpayer support.
It said that it “categorically denies and dismisses any such intent” and added that the West Midlands-based carmaker “is and remains a key pillar of Tata Motors and the wider Tata Group”.
The Indian business was responding to speculation about a possible sale after the failure of talks with the UK government about Jaguar Land Rover and Tata Steel — also owned by Tata Group — over a possible bailout.
Jaguar Land Rover had been seeking taxpayer support of up to £2 billion from the Treasury’s Project Birch fund because of the coronavirus pandemic. Project Birch was set up to help businesses seen as structurally important to the UK economy, but the government concluded that the financial strength of Tata meant that it was not appropriate.
In the three months to the end of June, Jaguar Land Rover car sales fell by 42.4 per cent, while shutting plants because of Covid-19 cost it £1.1 billion.
Before the pandemic added to its woes, Britain’s biggest carmaker had been struggling with a fall in sales in China, a trend away from diesel vehicles and uncertainties related to Brexit.
Under Sir Ralf Speth, 64, its chief executive, it has been seeking savings of £2.5 billion, as well as working towards building more electric vehicles, but the pandemic has interrupted those plans. There has been speculation that a merger with a larger manufacturer would make investment in the transition to electric cars more efficient.
However, Tata said: “Unconfirmed and unsubstantiated reports have been published alleging that Tata Motors may sell a stake in Jaguar Land Rover. It is and remains a key pillar of Tata Motors and the wider group.” It said that the carmaker “remains strong as it transitions to new electrified, autonomous and connected technologies”.
Thierry Bolloré, 57, the former boss of Renault, is due to take over as the chief executive in September as Sir Ralf becomes non-executive vice-chairman of the business. Sir Ralf’s pay has risen to £4.44 million during a year in which more than 4,000 workers lost their jobs.
Of its 40,000 workers, more than 30,000 are located in the UK. The business produces more than 500,000 cars a year.
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