Chip Shortage Forces Jaguar Land Rover To Announce Output Reduction At Its UK Plants

Jaguar Land Rover (JLR) is reducing output at its Solihull and Halewood factories until the spring due to ongoing issues obtaining enough computer chips for new vehicles.

The action is expected to have an impact on the output of models like the Jaguar F-Pace and the Land Rover Discovery Sport.

According to the Guardian, the relocation is only temporary. Meanwhile, JLR will concentrate on more profitable models such as the Range Rover.

In recent months, the output of these vehicles has increased. The JLR plant in Nitra, Slovakia, is unaffected.

Modern automobiles rely heavily on computer chips to control a wide range of onboard systems, including anti-lock braking and emissions controls, as well as satellite navigation and in-car entertainment.

However, supplies from East Asia have been severely disrupted as a result of the Covid pandemic, and carmakers have faced intense competition from other industries for available supplies.

In a statement, JLR said it would “continue to actively manage the operational patterns of our manufacturing plants whilst the industry experiences ongoing global semi-conductor supply chain disruption”.

“We expect our performance to continue improving 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,” it added.

Despite an increase in October, UK car production remains far below pre-pandemic levels, according to figures from the Society of Motor Manufacturers and Traders (SMMT).

The industry produced 69,524 cars in October, up 7.4% from the previous year, but the SMMT said manufacturers were still dealing with “turbulent” component supplies.

“There’s been real shortages in the supply chain, most obviously in semiconductors, which is leading to really erratic levels of production,” the SMMT’s chief executive Mike Hawes told the BBC’s Today programme.

“[Production] was up in October, but we expect it to be volatile as we go forward especially when some parts come from China.”

According to Hawes, the UK is “nowhere near” producing enough chips for the automotive industry.

“Massive investments are required and some governments in the world are putting up billions upon billions of pounds to attract investment and build new fabs (semiconductor fabrication plants).

“We should be building about a million cars a year, so when you have about 1,500 chips per car you can see just how incredible the volumes of these chips you need just to support the automotive industry, let alone things like personal electronics.”

(Adapted from TheTimes.co.uk)

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