The UK automobile company, Jaguar Land Rover, saw its retail sales fall by 37.6% than the earlier year, resulting in a loss of $12 million in the last three months of 2021 due to a global computer chip shortage.
Manufacturers around the world have been hit hard as they struggle to secure supplies of semiconductors.
“Whilst semiconductor supplies have continued to constrain sales this quarter, we continue to see very strong demand for our products underlining the desirability of our vehicles,” JLR’s chief executive Thierry Bolloré said in a statement.
However, the company also warned that it expects the chip shortage to continue throughout this year but expects supplies to gradually improve.
That helped push JLR’s Indian parent company Tata Motors to a 15.16bn rupees (£150m; $203.2m) loss for the period.
JLR also said that its order book has hit a new record high of around 155,000 vehicles, due to strong demand for the new Range Rover.
Chips are vital to modern cars, with a number of features including touchscreen controls, automatic emergency brakes, reversing cameras, fuel efficiency equipment, and airbag deployment systems all relying on them.
On Friday, industry figures showed that UK car production last year fell to its lowest level since 1965.
The Society of Motor Manufacturers and Traders said that just under 860,000 new cars left UK factories in 2021.
Production last year was 6.7% lower than in 2020 – and a full 34% below its pre-pandemic level.
The SMMT said the figures were dismal, largely thanks to a global microchip shortage and disruption caused by the coronavirus pandemic.
Other than JLR, motor industry giants such as Toyota, General Motors, Ford, Nissan, BMW, and Renault have also been impacted by the chip shortage along with a supply crunch. Therefore, these carmakers have been forced to cut back on production in recent months and have been struggling to secure adequate materials.
