This time, it's not the company's fault.
Jaguar Land Rover continues to emerge from challenging financial times that nearly killed it not long ago. A significant lineup overhaul will soon be underway for Jaguar that is set to become an EV-only brand starting in 2025. Land Rover will continue doing what it does best: SUVs. The reborn Land Rover Defender continues to be in high demand, as does the rest of the lineup. And therein lies the problem.
The ongoing semiconductor chip shortage is striking JLR in such a harsh and unforgiving way, Automotive News Europe reports, that any financial gains it's made over the past year or so could potentially be lost. As global chip supplies continue to dwindle, JLR has concluded new vehicle deliveries are 50 percent worse than predicted in the second business quarter of this year.
"The chip shortage is presently very dynamic and difficult to forecast," JLR said in a statement in coordination with its parent company, Tata Motors. "The broader underlying structural capacity issues will only be resolved as supplier investment in new capacities comes online over the next 12 to 18 months, and so we expect some level of shortages will continue through to the end of the year and beyond."
JLR has no choice but to cut vehicle output because of a lack of chips. And because it's not anywhere near in size and scope as other automakers, such as GM, Ford, Volkswagen, and Stellantis, JLR doesn't have the capability to shift focus from less popular models to more profitable ones.
That's exactly what GM has been doing, specifically by idling Camaro production in favor of more trucks and SUVs. High demand for those Land Rovers and Range Rovers is meaningless unless there are actually new vehicles to build and sell.
The chip shortage began last December and could possibly eliminate upwards of $110 billion in auto industry sales this year alone. Ramping up chip production takes time and it'll likely be well into next year until automakers receive relief. Let's hope JLR can keep up with its recovery until then.