Jaguar Land Rover, Britain’s biggest car maker, has swung to a quarterly loss of £302m after counting the cost of the global shortage of semiconductor chips.
JLR said the shortages had held back sales volumes – which fell by nearly half in the UK compared with the same period a year ago – in the three months to the end of September.
The second quarter loss compares with a profit of £65m for the same quarter in 2020.
But JLR, owned by India’s Tata Motors, said demand remained strong with global orders for vehicles from retail customers standing at a record 125,000.
It said the chip shortage “remains dynamic and difficult to forecast” but that it expects to see a “gradual recovery” starting in the second half of the financial year.
Meanwhile the company – which has provided a fleet of electrified vehicles for world leaders and delegates to the COP 26 summit in Glasgow – said the share of such vehicles it sold, including hybrids, rose to 66% in the latest quarter.
JLR had previously predicted a tough period as a result of the chip shortages.
However, in its latest results statement, it said it had burnt through less cash than expected as it focused on higher margin products and kept a lid on costs.
The company saw the volume of wholesales to dealerships fall by 12.8% year-on-year to 64,032 while direct retail sales dropped by 18.4% to 92,710.
The biggest hit to retail sales came in the UK, where JLR shifted 48% fewer units than in the same period last year, while North America saw a decline of 16%.
JLR said retail sales of all models were lower year-on-year except for the new Land Rover Defender, which sold 16,725 vehicles, up 70%.
Chief executive Thierry Bollore said: “The global semi-conductor shortage remains challenging but I’m pleased to see the actions we have been implementing reduce the impact.
“With strong customer demand with a record order book we are well placed to return to strong financial performance as semiconductor supply begins to improve.”
The global chip shortage has affected, to varying degrees, carmakers and other manufacturers across the world from Tesla and Apple to Toyota and Sony.
Industry figures from last week showed the number of cars built in the UK fell to their lowest September level since 1982 amid the shortage.BUSINESS NEWS • ECONOMIC NEWS • MAKE MONEY • News