British luxury carmaker Jaguar Land Rover (JLR) will focus on reducing its breakeven levels back to 300,000 units in the next two years, according to the Tata Motors Passenger Vehicles Chairman N Chandrasekaran.

JLR's break-even volume threshold went up significantly above 325,000 units in 2025-26 due to tariffs, currency and commodity inflation. JLR had taken several years to halve its break-even volume threshold to around 325,000 units from 600,000 units in FY19.

During FY26, Tata Motors Passenger Vehicles generated negative free cashflows, largely due to impact on volumes from production stoppages and working capital movements following a crippling cyberattack at JLR that halted production for five weeks. JLR was also impacted by tariffs affecting exports from the UK and the EU to the US.

“In the first quarter, we faced a hike in costs from incremental trade tariffs of 27.5% on our UK and EU exports to the US. These were later reduced to 10% and 15% respectively, where they now remain. In the second quarter, we proactively shut down our systems as a precautionary measure in response to the cyber incident. Production was paused before restarting on 8 October and returning to normal levels by mid-November,” P B Balaji, the newly appointed Chief Executive Officer of Jaguar Land Rover, said in the company’s Integrated Annual Report 2025-26.

The cyberattack cost JLR about 50,000 units in terms of production loss. The company did not have any cybersecurity insurance when the attack happened in September 2025.

Following the JLR cyberattack, Tata Motors consolidated net debt has ballooned to Rs 30,710 crore at the end of FY26 as compared to a net cash position of Rs 1,018 crore at the end of FY25.

Following the cyberattack, Balaji said the automaker continues to invest in further strengthening its IT systems.

“Cybersecurity risks remain elevated, as malicious actors continue to target all types of organisations and cause disruption, as we experienced in 2025,” the company said.

In addition to the impact of the cyberattack, retail sales were affected by challenging market conditions and weakening global demand. China’s luxury tax now captures a larger proportion of JLR’s model range. Retail sales from its China Joint Venture fell 26.8% year-on-year to 24,987 units.

Going forward, Tata Motors domestic passenger vehicle business could see more synergies with JLR. Tata Motors Passenger Vehicles and Jaguar Land Rover will continue to collaborate on manufacturing, technology and people, enhancing scale efficiencies, accelerating learning and reinforcing capital discipline, said Chandrasekaran. “Early progress is evident with the commencement of operations at the new Panapakkam facility in Tamil Nadu, creating a shared manufacturing facility for best practice execution and scale benefits,” he added.

Published on: Jun 16, 2026 5:05 PM IST