JLR latest affected by aluminium shortage

JAGUAR LAND ROVER (JLR) has become the latest European manufacturer to be affected by the supply of aluminium from Swiss producer Novelis.

 

The key aluminium supplier was impacted by flooding last month, affecting crucial deliveries to OEMs including Audi, BMW, Ford, Mercedes-Benz, Porsche, Stellantis and Volkswagen.

 

Now, JLR has joined the list of those impacted with vehicle production numbers expected to taper through this quarter and the next.

 

“Jaguar Land Rover’s biggest headwind is an upcoming shortage of aluminium after production at a plant owned by key supplier Novelis was hit by flooding,” said JLR chief financial officer Richard Molyneux referring to Novelis partner Constellium.

 

“We will do our damnedest to make sure that does not stop us hitting our EBIT targets for the year. Our industrial operations are very good at finding alternative sources, and we are also leveraging the Tata ecosystem to help us.”

 

JLR models including the Range Rover and Range Rover Sport use aluminium in their construction. It is estimated that around 180,000 tonnes of the metal is required annually in the construction of JLR vehicles.

 

Last month, Porsche lowered its production output by 17,400 units in the wake of the aluminium shortage from Novelis and Constellium. It said supply problems could lead to a shutdown of production for more than one vehicle series.

 

Audi, BMW and Mercedes-Benz have cited similar issues, saying they have struggled to source an alternative supplier.

 

Speaking on the impact of the Rhone Valley flooding, Novelis and Constellium said the “exceptional” event had seen up to 200mm on mud deposited in its facilities at Sierre and Chippis, fully suspending all operations.

 

While all employees are reported as safe, the damage to stock, machinery and underground infrastructure is considered extensive.

 

The amount of silt and mud deposited through the facilities is reportedly hindering assessment efforts, the duo saying it cannot yet provide an accurate estimation of when production will restart.

 

“We are committed to restarting production at both facilities as soon as we can safely and efficiently do so,” said Constellium in a statement.

 

“In the meantime, we are working with our customers and suppliers to identify mitigation plans during this unprecedented time, optimising all capacity available within Constellium’s industrial platform.

 

“Constellium will share further updates as more information becomes available.”