Chip shortage hits sales at Jaguar Land Rover

A global shortage of semiconductor chips has hit sales and led to a pre-tax quarterly loss of £302m at Jaguar Land Rover, although forward orders for its vehicles remain strong. Tony McDonough reports

Jaguar Land Rover employs around 3,700 people at Halewood


Carmaker Jaguar Land Rover (JLR) is reporting a fall in quarterly sales and a £302m pre-tax loss, blaming the ongoing global shortage in semiconductor chips.

However, the company, which employs around 3,700 people at Halewood in Merseyside assembling the Land Rover Discovery Sport and Range Rover Evoque models, says demand for its products remains strong.

In the three months to September 30, JLR said revenue was £3.9bn, lower than the £4.4bn in the same period last year. With the chip shortage hitting production, including at Halewood, wholesales to dealers in the were 64,032 vehicles, down 12.8% year-on-year, and retail sales (including the China Joint Venture) were 92,710 vehicles, down 18.4%.

READ MORE: Why hasn’t JLR had its chips?

Retails were lower year-on year in most regions, including North America (-15.6%), China (-6.3%), Europe (-17.0%), and in the UK (-47.6%), but were up in our overseas region (+10.0%).

Despite the impact of the semiconductor shortage on production and sales, JLR continues to see strong demand for its products with global retail orders at record levels of more than 125,000 vehicles.

In August LBN reported that companies seeking JLR lease vehicles were looking at delays of up to a year. In April this year JLR the company had to temporarily halt production at Halewood and its plant at Castle Bromwich in the West Midlands. The chips are essential for modern vehicles which relay heavily on digital technology.

Adrian Mardell, JLR’s chief financial officer, said: “The global shortage of semiconductors continued to constrain our production, sales and financial performance in the second quarter but we’re encouraged to see the continuing strong demand for our products with order books at new record levels.

“We were pleased the cash outflow on these volumes came in significantly better than expected, reflecting the progress we are making to reduce the break-even point for the business through product mix optimisation and cost controls.”

Driven by the company’s Reimagine strategy to achieve net zero emissions by 2039, Jaguar Land Rover is partnering with COP26 at the climate change summit in Glasgow.  Jaguar Land Rover has provided a fleet of electrified vehicles to world leaders and delegates attending the summit.

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