S&P downgrades India’s Tata Motors PV outlook on JLR’s slow recovery after cyberattack

Ratings agency S&P Global on Thursday downgraded its outlook for India’s Tata Motors Passenger Vehicles to “negative”, citing a “slow recovery” of the carmaker’s core Jaguar Land Rover (JLR) unit, which was hit by a cyber attack early last month.

The cyber incident at the British JLR, the cash cow unit of Tata Motors, led to a production pause of more than three weeks and had a negative impact on turnover. The automaker resumed phased production at the end of September.

Following the split of Tata Motors into separate companies focused on passenger and commercial vehicles, the impact of JLR’s volume loss is “more pronounced”, S&P said, as it expects JLR to be responsible for more than 80% of Tata Motors PV’s revenues in the future.

“The path to recovery remains uncertain. We believe that a recovery in JLR’s profits is subject to a range of uncertainties, both related to market conditions and the consequences of the cyber attack.”

S&P also downgraded JLR’s outlook to ‘negative’, saying the attack could have wider implications not currently factored into estimates, such as higher legal costs, the impact of brand reputation and delays in new model launches.

Although JLR has resumed production, ramping up to full capacity is likely to be gradual. S&P said it added that U.S. tariff-related headwinds and launch delays could pose further risks.