Shares of Tata Motors Ltd, the parent company of Jaguar Land Rover (JLR) and a manufacturer of passenger and commercial vehicles, fell as much as 6% on Thursday, 27 March, after US President Donald Trump announced that he would impose 25% tariffs on automobiles that are not made in the US.

These tariffs will take effect on 2 April, the day Trump also declares reciprocal levies on countries, the specifics of which are still unknown.

The United States is a major market for Jaguar Land Rover, with about one-third of its sales in 2024 coming from North America, primarily the US. JLR’s fiscal year 2024 annual report states that 22% of its entire revenues came from the US market.

Tata Motors’ management has reiterated that JLR will meet its fourth quarter projection of 10% EBIT margins and be net debt-free by the end of the current fiscal year. 

Vehicles sold by Jaguar Land Rover (JLR) in the US, which are predominantly produced in the UK and other international plants, will now be subject to a 25% import tariff.

In Q3, the company faced challenges due to weaker margins and lower JLR sales volumes despite an improvement from the previous quarter. The EBITDA margin declined by 200 basis points, settling at 14.2%. Meanwhile, JLR’s profit before tax (excluding exceptional items) dropped to £523 million, compared to £627 million in the same period last year.

At 1:02 pm, the shares of Tata Motors were trading 5.58% lower at Rs 668.70 on NSE.

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