The UK government is set to provide a £1.5 billion loan guarantee to Jaguar Land Rover (JLR) to assist its suppliers amid a prolonged production halt due to a cyber attack. Business Secretary Peter Kyle announced that this loan, sourced from a commercial bank, aims to safeguard jobs in regions including the West Midlands and Merseyside.
JLR has suspended production since late August after being targeted by hackers, raising concerns about the financial viability of many of its small suppliers. The company’s extensive supply chain, which supports approximately 150,000 employees, is particularly vulnerable, with reports indicating that some suppliers may only have a week’s worth of cash remaining.
The government plans to back the loan through the Export Development Guarantee (EDG), a financial initiative supporting UK businesses engaged in international trade. JLR is expected to repay the loan over five years, which is intended to relieve some of the financial pressures on the company and help settle outstanding payments to suppliers. Currently, no vehicles have been produced this month, and JLR has ceased ordering from its network of 700 suppliers.
Parliamentary discussions revealed that the operational stoppage is estimated to cost JLR around £50 million weekly. The company, owned by Tata Motors of India, normally manufactures about 1,000 cars each day across its facilities in Solihull, Wolverhampton, and Halewood.
While some government officials, including Chancellor Rachel Reeves, have voiced strong support for the initiative, opposition figures argue that the response has been insufficiently timely. Union representatives expressed cautious optimism, urging that the funds be used wisely to protect jobs and skills within the supply chain.
The cyber attack, attributed to a group known as Scattered Lapsus$ Hunters, has significantly impacted JLR’s operations, with employees instructed to remain at home with no set date for their return. JLR’s spokesperson stated that the company is collaborating with cybersecurity experts to safely resume production.
Source: https://www.bbc.com/news/articles/cgl15ykerlro?at_medium=RSS&at_campaign=rss