Jaguar Land Rover staged a recovery in the final three months of 2020, as the growth of car sales in China made up for the UK’s continued lockdowns and its setting aside of £35m to pay fines for missing carbon dioxide emissions targets. The carmaker made pre-tax profits of £439m in the last quarter of the year, £121m higher than in 2019, JLR said on Friday. Revenues recovered to £6bn, £1.6bn more than the July-to-September period, although still lower than at the same point the year before. JLR lost its status as the largest carmaker in the UK during 2020 as production fell by a third, allowing it to be narrowly overtaken by Nissan, the Japanese carmaker. The production fall was a testament to the difficulties faced by carmakers in Britain and beyond, as the coronavirus pandemic forced JLR and its rivals to shut factories for months, and hit sales. JLR lagged behind rivals in restarting production. However, the carmaker, which is owned by India’s Tata Motors, said sales in China, which has reduced Covid-19 cases, were a fifth higher in the three months to December than both the previous quarter and the same period the year before. JLR sold 128,000 cars during the quarter, down by 9% year-on-year amid continued restrictions in key markets such as the UK, helped by the rollout of the revamped Land Rover Defender. The carmaker sold 16,300 of the new off-roaders, whose launch was delayed by the pandemic. JLR’s improved profitability partly reflected £400m in cost savings during the quarter, part of a revamp started by its previous chief executive Ralf Speth. The former Renault boss Thierry Bolloré, who took over at JLR in July, is working on his own long-term strategy for the company as it moves towards pure battery electric cars. The fine for missing EU emissions targets highlighted the challenge JLR faces, as its big, heavy petrol and diesel cars generally emit significant amounts of carbon dioxide. JLR has started to aggressively promote plug-in hybrid electric vehicles (PHEVs) that combine internal combustion engines with battery power that can lower emissions if charged correctly. Matthias Schmidt, an independent automotive analyst, said PHEV sales, which are attractive to company car drivers, would be likely to protect it from large fines during 2021. Bolloré said he was “encouraged by the improved financial performance in this first full quarter as CEO”, but predicted continued turbulence for carmakers. “Looking ahead, these challenges continue, including the Covid pandemic and its impact on the global economy, the UK’s new trading relationship with the EU and the significant technological changes taking place in the automotive industry,” he said.