Jaguar Land Rover (JLR) has announced that production across its factories will remain suspended until at least October 1, marking a continuation of the shutdown initiated following a severe cyber-attack late last month. The attack compromised the company’s IT networks, effectively halting vehicle production and raising concerns about the long-term viability of its supply chain partners.
On Tuesday, the Business Secretary and the Industry Minister are scheduled to visit JLR for the first time since the incident. Their visit aims to engage with the company and its suppliers, many of whom are grappling with the financial repercussions of the stoppage. In a statement, JLR acknowledged the challenges faced by all associated with the brand, reaffirming their commitment to support customers, suppliers, and retailers who are still operational.
As the halt in production persists, reports suggest disruptions may stretch into November. Industry Minister Chris McDonald emphasized the government’s priority of restoring JLR’s operations swiftly while ensuring the long-term stability of its supply chain. He expressed empathy for the suppliers and their employees who are suffering financial strain due to the shutdown.
The economic impact of the suspension is staggering, with estimates suggesting that JLR could be losing at least £50 million each week. Politicians and union leaders have raised alarms about the potentially devastating effects on smaller businesses within the supply chain. Johnathan Dudley, head of manufacturing at Crowe UK, emphasized the importance of addressing the suppliers’ concerns, highlighting an urgent need for support as some businesses report they are struggling to pay employees.
Prof. David Bailey from the University of Birmingham outlined the broader implications of the shutdown, warning that if parts of the supply chain collapse, it would complicate any efforts to restart full production at JLR. He asserted that the government would ultimately incur costs related to wage support measures if workers were laid off.
In light of the crisis, local businesses are calling for government intervention. Steve Whitmarsh, CEO of a Solihull-based service firm, expressed the need for immediate government assistance, stating that losing the supply chain would have severe repercussions on the economy. He argued that proactive support would avert greater costs to taxpayers in the long run.
JLR’s manufacturing facilities in the UK employ approximately 30,000 people directly, with an additional 100,000 individuals in the supply chain. The economic ripple effect also extends to around 60,000 people who depend on the disposable income of JLR workers. While JLR is taking steps to support its supply chain, calls for government-backed loans akin to those provided during the COVID-19 pandemic are mounting among local MPs.
Unite, one of the country’s largest trade unions, has also urged for a furlough scheme to assist workers affected by the shutdown, as some employees are reportedly being advised to turn to Universal Credit amid the crisis. As the situation evolves, the focus will remain on safeguarding jobs and ensuring the resilience of the automotive supply chain during this tumultuous period.
