Ministers are considering emergency measures to support Jaguar Land Rover’s (JLR) suppliers, following a crippling cyber-attack that has halted production at the UK’s largest carmaker.
The hack, which took place at the end of August and came to light on 1 September, forced JLR to shut down its IT systems and suspend output across its three UK factories in Solihull, Wolverhampton, and Halewood. The disruption is costing the Tata Motors-owned company an estimated £50m a week, with production now unlikely to resume before 1 October.
While the attack has disrupted JLR’s global operations — including plants in Slovakia, China, and India — the most immediate concern lies in the UK supply chain. Tens of thousands of jobs depend on smaller firms that rely almost exclusively on JLR contracts. Industry experts warn that without intervention, many of these companies could face bankruptcy within weeks.
Government options under consideration include purchasing and stockpiling parts made by suppliers to sustain them until production restarts. However, such a plan would face logistical challenges, as JLR’s manufacturing relies on precise “just-in-time” processes. Another option is government-backed loans, though suppliers remain wary of taking on additional debt.
Former West Midlands mayor Andy Street urged ministers to act, arguing that the contribution of JLR and its suppliers to the UK economy makes the case for intervention. “If you think of the total income that JLR and its supply chain put into the Exchequer, this is a good deal for the Exchequer,” he told BBC Radio 4.
Union leaders have meanwhile called for a Covid-style furlough scheme to protect jobs, but ministers are understood to have dismissed this due to the potential costs. Around 30,000 people are directly employed at JLR’s UK factories, with a further 100,000 working across its supplier network. Many have already been sent home without clarity on when they will return.
The cyber-attack, claimed by a group calling itself Scattered Lapsus$ Hunters, has heightened concerns about rising threats to major UK institutions. The same group has claimed responsibility for recent attacks on Marks & Spencer and the Co-op, the latter reporting losses of at least £206m.
Ministers, including Business Secretary Jonathan Reynolds and Industry Minister Chris McDonald, visited the West Midlands this week to meet JLR executives and suppliers. Speaking at Webasto, one of JLR’s major suppliers, McDonald stressed that the government aimed to work alongside businesses rather than impose solutions.
The Department for Business and Trade confirmed it is in ongoing talks with the company and its suppliers, saying ministers are focused on “the impacts of the cyber-incident and how JLR can work towards restarting production.”
With the Business and Trade Select Committee set to hear testimonies from affected firms, pressure is mounting on ministers to act swiftly. For suppliers already struggling with high costs and thin margins, the difference between intervention and delay could be survival itself.