8:50 am, May 13, 2022
Jaguar Land Rover slumped to losses of £455m last year as the shortage of semiconductors bit the British brand hard.
Full-year results laid bare the extent of a global scarcity of chips had on the Gaydon-based business.
The £455m loss also included a £43m right-off of the firm’s Russian operations, which were closed in Q4 because of sanctions over the Ukraine war.
Revenue was £18.3bn, down seven per cent on the previous year.
The £455m pre-tax loss stands in sharp contrast to the £662m profit the firm made in the 2021 financial year.
A year ago Jaguar Land Rover (JLR) recorded a £534m pre-tax profit for the first three months of 2021, hailing the performance as a sign of it making ‘significant progress’.
Total car sales for the year came to 376,381, which was down 14 per cent on the year before.
As of March 31, 2022, the company’s new car order bank stood at 168,000. The new Range Rover amassed a bank of 46,000 orders while there’s a 41,000-strong list for Defenders.
Overall, deliveries of Land Rovers and Range Rovers fell by 12 per cent to 299,000, while Jaguar sales fell to a new low of 77,000, down 20 per cent, according to The Times.
Just five years ago, JLR was reporting sales of 604,000 and revenues of £24bn.
JLR did say its Reimagine transformation strategy ‘significantly exceeded the original £1bn target for FY22 and delivered £1.5bn of value in the year’.
It also said that sales in Russian and Ukraine account for 2.5 per cent of global sales and remained ‘paused’, and while a ‘relatively small’ number of parts are sourced from the countries, ‘it is too early to say how future commodity supply and pricing could be impacted’.
JLR also warned volume improvements in Q1 FY23 are expected to be limited by Covid lockdowns in China and the changeover from the outgoing Range Rover Sport to the new model, unveiled this week.
The firm added it expects its EBIT and cash flows to be ‘negative’ in Q1.
Jaguar Land Rover’s chief financial officer, Adrian Mardell, said: ‘Despite the ongoing semiconductor supply constraints limiting production, we have delivered a second successive quarter of positive cashflow demonstrating our continuing focus on revenue optimisation and cost efficiencies.
‘Despite the present chip supply, inflation and other challenges, our lower breakeven point should position us well as volumes gradually recover.’
