UK government backs £1.5bn loan guarantee for Jaguar Land Rover
The government has announced it will underwrite a £1.5 billion loan guarantee to Jaguar Land Rover (JLR) as part of a strategy to protect jobs and stabilize the company’s sprawling UK supply chain during a prolonged cyberattack. The guarantee will be provided through the Export Development Guarantee (EDG) facility, and the loan will come from a commercial bank. JLR will repay the amount over five years, bolstering its cash reserves as it clears a backlog of supplier payments.
What the loan covers and how it is funded
Business Secretary Peter Kyle said the arrangement is designed to shore up the carmaker’s suppliers in the West Midlands, Merseyside and across the country. By backing the loan through the EDG, the government aims to reassure more than a single company’s finances and instead ward off cascading failures in the supply chain that could ripple through the UK auto sector.
Officials emphasised that this support is intended to maintain the integrity of the UK automotive ecosystem, which includes JLR’s roughly 150,000-strong workforce within its supplier network. The loan’s repayment over five years is structured to ease liquidity pressures caused by the current halt in production and to support continued operations, even as car orders slow.
Impact on workers and suppliers
Since the cyberattack at the end of August, JLR has suspended production and halted new orders with its 700 suppliers. The company has said that no cars have been built this month. A parliamentary committee reported that some small suppliers faced cashflow shortfalls so severe they had “at most, one week left” before depletion. The shutdown is estimated to be costing JLR itself at least £50 million per week, underscoring why government intervention is deemed necessary to protect jobs and skills across the network.
JLR’s workforce comprises about 30,000 people directly employed at its plants in Solihull, Wolverhampton and Halewood, with the remaining employment tied to suppliers and related service providers. The government’s guarantee is intended to provide a steady lane of funding while the company works with cybersecurity specialists, the National Cyber Security Centre (NCSC) and law enforcement to restart safely and avoid reoccurrence of the disruption.
Reactions from politicians and unions
Chancellor of the Exchequer Rachel Reeves framed the move as a crucial shield for thousands of UK jobs, noting the direct and indirect benefits across regional economies. Shadow business secretary Andrew Griffith welcomed the government’s action but urged swifter delivery and hinted at broader reforms to cyber risk financing. Liberal Democrat business spokesperson Sarah Olney called the move welcome but argued that the government should also consider furlough-style measures if needed to protect affected workers.
Unite, the union representing thousands of JLR employees and suppliers, described the step as an “important first step” and urged that the funds be used to safeguard jobs and maintain skills and pay within JLR and its supply chain.
The cyberattack context and recovery plan
The assault, claimed by a group identifying itself as Scattered Lapsus$ Hunters, follows a string of high-profile breaches against retailers this year. JLR’s management says it is working around the clock with cybersecurity specialists, the NCSC and law enforcement to resume production in a safe and secure manner. The company has emphasized that the recovery program’s foundational work is underway and that regular updates will be provided to colleagues, retailers and suppliers as the restart progresses.
Looking ahead for JLR and the UK auto sector
With the EDG-backed loan, the government hopes to restore order to the supply chain, preserve skilled jobs, and safeguard the UK’s status as a leading automotive hub. While the exact timeline for restarting production remains fluid, the arrangement represents a pragmatic policy response to a cyber risk that has the potential to ripple beyond a single plant and shed light on the broader resilience needs of Britain’s manufacturing ecosystem.
