Jaguar Land Rover receives £1.5bn rescue to survive cyberattack shutdown until Christmas

Jaguar Land Rover has secured a £1.5 billion government-backed lifeline to support its business and suppliers through to Christmas after a crippling cyberattack brought operations to a halt. Britain’s largest carmaker, which usually manufactures 1,000 vehicles daily across three UK sites, has seen global production suspended for almost a month following a significant breach of its IT systems by hackers.

The rescue comes in the form of a loan guarantee facilitated by Business Secretary Peter Kyle, allowing JLR to access private finance more swiftly and channel funds towards critical suppliers. This move comes after several warnings that indirect suppliers in the automotive supply chain, comprising mostly smaller firms dependent on JLR, were struggling with cash flow as a result of the shutdown. JLR directly provides jobs for 34,000 workers in the UK and supports an additional 120,000 through its supply network.

Suppliers have reportedly been told to prepare for a phased reopening of JLR’s £500 million engine plant in Wolverhampton in early October. However, industry sources indicate that regaining full production capabilities will only be achievable through a gradual restart, with expectations set for completion no sooner than Christmas. A group of suppliers met with Peter Kyle earlier in the week, expressing the urgent requirement for £1.5 billion in aid to remain operational until the end of the year, just as JLR board members held government discussions on the same day.

The loan guarantee is being provided through UK Export Finance’s export development scheme, which is designed as a backstop guaranteeing 80 per cent of the value of loans in case of repayment default. These guarantees, available to major UK businesses reliant on exports, have previously been used to support firms during extraordinary circumstances, including the Covid pandemic. Importantly, the state does not inject cash into the business but instead reduces lenders’ risk, encouraging the release of funds.

While the government characterises the intervention as decisive action to protect jobs and the wider automotive sector, there is some scepticism among industry analysts over whether the aid apparatus will adequately reach indirect suppliers. JLR, owned by Tata Motors, is ultimately responsible for repayments, so the pressure on the company remains immense. Earlier this year, a similar guarantee supported Ford’s electric vehicle production, highlighting the ongoing strategic significance of the British-based automotive industry.

Chancellor Rachel Reeves described JLR as a crown jewel of the UK economy, emphasising the need to protect tens of thousands of skilled jobs and the businesses dependent on the carmaker. Shadow Business Secretary Andrew Griffith welcomed the support but called for additional measures, including the development of a cyber reinsurance programme to shield British firms from increasingly sophisticated cyberthreats.