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The Australian suffered an issue with his digital roadbook midway through the stage and mistakenly followed another lost rider during the stage trying to find his way.
The KTM rider went into the third stage of the rally with a lead of 12 minutes and 36 seconds but that was whittled down to just six minutes and 51 seconds.
Skyler Howes remains second overall in the standings for Honda.
‘Chucky’ was 17th fastest in Stage 3, which covered 793km. Sherco Rally Factory rider Lorenzo Santolino was fastest in the stage.
“I felt really good on the bike today and my navigation this morning was spot on through some of the really difficult parts,” said Sanders.
“Unfortunately, I had an issue with my roadbook tablet after the refueling stop so I really struggled to navigate.
“I was lost for a while as I had no way of knowing the route, and I decided to follow a rider who then also got lost which cost me even more time.
“The good thing is I’m still leading the overall, so all I can do now is freshen up, recover and get ready to claim some time back tomorrow.”
In the cars division, Toby Price drifted back to sixth in the standings after setting the 18th fastest time on Stage 3.
The Toyota HiLux pilot suffered overheating issues, preventing him and co-driver Sam Sunderland from attacking the stage at full power.
The pair stopped briefly to ascertain what was wrong with their car but opted to continue on at slow speed.
“Around 15km into the stage we had high temperatures in the car and had to manage that by keeping our top speed to 130km/h,” Price wrote on social media.
“Feel like we lost a lot of time because of it, but I’m glad we could at least manage the situation given how much carnage is out there.”
Settle in, grab a drink and get ready for the full highlights from #Dakar2025 Stage 3️⃣
Watch here 👉 https://t.co/ry66E7qJAa
Highlights presented by @aramco 👍 pic.twitter.com/sFk2zgR1do
— DAKAR RALLY (@dakar) January 7, 2025
The race of attrition claimed two high-profile competitors this week. Ford’s Carlos Sainz was the first to bow out before Loeb rolled his Dacia Sandrider.
Like Sainz, Loeb suffered too much damage to his roll cage and was ruled out of the contest by the FIA.
“At the start of the special, I thought we were on the tracks, but we were to the side,” Loeb explained, before he was ultimately ruled out.
“I hit a rut that turned us sideways and the car rolled. That took the tyres off two wheels, but we managed to sort it out within five minutes.
“There wasn’t so much damage, but after 50 kilometres we broke a steering rod. It’s not a serious problem, but our spare part was with the bits of bodywork that had been ripped off when the car rolled.
“Cristina stopped to give us one, but after that the front engine fan stopped working, so we drove at SSV pace during almost all the stage.
“It wasn’t the kind of day we prefer. We lost an hour and we got the feeling that we were in ‘it’ up to our necks… But it is what it is.”
Toyota’s Saood Variawa topped the stage while his teammate Henk Lategan ended the day on top overall.
Nasser Al-Attiayha wound up seven minutes and 17 seconds off the lead while Ford’s Mattias Ekstrom sat third, nine minutes and 34 seconds away.
