Tata Motors has announced a shock quarterly loss of more than $1 billion.
The Jaguar Land Rover (JLR) owner wrote off $2.1 billion related to its revamp of the UK-based luxury car business.
It also warned that a global semiconductor shortage is now impacting production plans for the current quarter.
Last month JLR temporarily halted production at its two main factories in Britain due to a lack of chips.
For the quarter that ended on 31 March, Tata Motors reported a net loss of $1.04 billion, compared to analysts’ expectations of a $365.4 million profit.
That was even as JLR’s sales in China jumped by 127% from a year ago and Tata Motors’ overall retail sales, which account for most of its revenue, rose 12.4%.
The shortage has forced the world’s biggest carmakers, including Toyota, Nissan, General Motors and Ford, to cut production.
This week, Toyota announced that it would temporarily stop production at two of its plants in Japan next month.
Last month, JLR made a similar move, saying in a statement: “We have adjusted production schedules for certain vehicles which means that our Castle Bromwich and Halewood manufacturing plants will be operating a limited period of non-production from Monday 26th April”.
The global motor industry was already reeling from the sharp downturn in sales caused by the pandemic and the challenges of switching to electric-powered vehicles.
In February, Jaguar Land Rover announced that its Jaguar brand would be all-electric by 2025 and that it will launch electric models of its entire Jaguar and Land Rover line-up by 2030.
Carmakers are under pressure to meet stringent carbon emission demands in Europe and China, as well as customer demand for high-performance electric cars with a luxury or performance feel.