Rise Of Tata Motors Feeds Optimism For JLR Company As China Market Recovers
Chinese auto and auto-related stocks surged today after government officials there pledged to encourage auto usage.
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On July 7, Tata Motors' stock increased as a result of the day's previous significant advances for Chinese automakers.
Chinese auto and auto-related stocks surged today after government officials there pledged to continue to boost the nation's vehicle demand. Due to the extraordinary lockdowns in several areas of the country brought on by a new Covid-19 outbreak and the ongoing semiconductor shortage, the Chinese auto industry faced a number of difficulties in 2022.
According to a Bloomberg article, the country's State Council Information Office had earlier in the day emphasised the value of encouraging the sales of new-energy vehicles and prolonging the exemption of purchase tax on electric automobiles.
Investors are encouraged by the recent growth in the Chinese auto market and anticipate continued robust expansion. According to a Barron's report, retail auto sales in China increased by 33 percent over the previous year and by 28 percent over the previous month in the last week of June.
Given that a sizable portion of the company's sales are generated in China, executives at Tata Motors subsidiary Jaguar Land Rover will be ecstatic with the upswing in the Chinese auto market.
Increased worries about demand in the US and the EU, two economies that look to be heading for an economic slowdown as a result of high energy prices, will be partially offset by a recovery in the world's largest auto market.
JLR has faced challenges as a result of the ongoing semiconductor shortage, which has slowed manufacturing and prevented it from meeting demand. Although the management has expressed optimism that the scarcity will ease in the second half of 2022–2023, the situation is projected to worsen in 2023.
Tata Motors has had good luck in the local auto market, as seen by its sales rise of 4% from month to month and 87.5% from year to year in June. Sales of passenger automobiles as a whole increased 102 percent year over year to 130,125 units for the corporation in the June quarter.
On the National Stock Exchange, Tata Motors shares were up 1.6 percent at Rs 422.80 at 12:24 p.m.
