Jaguar Land Rover (JLR), the largest auto manufacturer in the UK, is having trouble finding semiconductors due to worldwide scarcity. Therefore it has decided to temporarily cut production at its UK operations until March next year.
According to industry insiders, as reported by The Guardian, the automaker would reduce output at its Solihull and Halewood facilities between January and the end of March.
This is an effort to prioritize its most lucrative models after the announcement of CEO Thierry Bolloré's retirement last week.
Shortage Impact
Since early 2021, JLR and other automakers have been struggling due to chip shortages. As the coronavirus epidemic escalated, several carmakers reduced their orders for the computer chips, only to find themselves at the back of the line as demand surged again.
On Friday, Nov. 25, the Society of Motor Manufacturers and Traders, an industry group, released figures showing that UK auto manufacturing in October was just slightly higher than the pre-pandemic level of 2019.
The Guardian reported that a total of 69,524 vehicles were manufactured in the UK, down 48% from 2019 but up 7% from the previous year.
This November, JLR announced a record order book of over 205,000 vehicles. However, the chip shortage has hampered the company's attempts to increase production of the newest models of its Range Rover and Range Rover Sport vehicles (both of which are manufactured in Solihull) and its Defender vehicle (which is produced in Slovakia).
Changes in UK Plants
Based on the report, manufacturing of the more affordable Range Rover Velar and Jaguar F-Pace will be consolidated into a single shift at Land Rover's Solihull plant in the West Midlands, while a second shift is added to build Range Rover body panels.
The Merseyside facility at Halewood will similarly reduce to one shift every day. The Discovery Sport and the more compact Range Rover Evoque are also manufactured at this facility.
JLR has been striving to ensure its longer-term supply of semiconductors and has not yet made plans to cut shifts beyond March.
Last month, they just signed a contract to sell silicon carbide semiconductors to Wolfspeed in the US.
Also Read : Jaguar Land Rover to Convert Its Halewood Plant to Support Transition to Electric Vehicles
The Former CEO
In the wake of Bolloré's unexpected retirement for "personal reasons," Tata, JLR's Indian owner, has been scrambling to find a replacement CEO.
The company's approach to electrifying its product line-up, in particular, has come under scrutiny as a result of the departure, although JLR maintains that its strategy will stay intact.
During the anticipated extended recession and deteriorating living standards in the UK, The Guardian said automakers would also likely see weaker demand in the short run.
While JLR has been losing money for the previous 18 months, former CEO Bolloré expressed optimism about an increase in chip supply during the company's most recent financial results presentation in November.
According to him, "We expect to continue to improve our performance in the second half of the year, as new agreements with semiconductor partners take effect, enabling us to build and deliver more vehicles to our clients."
This article is owned by Tech Times
Written by Trisha Kae Andrada
