What the deal means for Jaguar Land Rover and its suppliers
The British government has agreed to underwrite a £1.5 billion loan guarantee for Jaguar Land Rover (JLR) through the Export Development Guarantee (EDG) scheme. The move is designed to stabilise a fragile supply chain as the car maker continues to operate under the shadow of a major cyber attack that halted production at its plants. The guarantee is aimed at shielding thousands of jobs and the broader UK automotive ecosystem that relies on JLR and its 700 suppliers.
JLR employs around 150,000 people across its UK operations and its suppliers directly support tens of thousands more in the West Midlands, Merseyside and nationwide. The backing is intended to give suppliers confidence to weather a prolonged shutdown by ensuring continued cash flow while production remains suspended. In practical terms, the loan will be repaid by JLR over five years, helping to bolster the companys cash reserves as it negotiates a backlog of payments to suppliers and other lenders.
The company has not produced any cars in the current period, and the plant network in Solihull, Wolverhampton and Halewood has seen orders paused as teams work with cybersecurity specialists, the National Cyber Security Centre and law enforcement to restart in a safe and secure manner. While the halt continues, the impact on the broader supply network has been a growing concern for small businesses that rely on timely payments to stay afloat.
How the Export Development Guarantee works
The EDG is a government supported mechanism designed to support UK exporters and their supply chains by providing guarantees that can unlock private finance. In this case the government will back a loan from a commercial bank, enabling JLR to access the liquidity needed to safeguard operations and downstream suppliers. The five year repayment term is intended to give the automaker a clear runway to restore production, manage payables and rebuild confidence among its 700 suppliers.
Officials emphasise that the measure is not a bailout but a calibrated support tool to protect jobs and preserve critical manufacturing capacity during a period of disruption caused by cybercriminal activity. The government says the programme will help sustain the UK automotive sector, which has long relied on a robust and integrated supply chain spanning multiple regions.
Economic and regional impact
The reliance of the UK automotive industry on a strong regional network means that any disruption resonates beyond the factory floor. The West Midlands and Merseyside, in particular, stand to benefit from the guarantee by reducing the risk of supplier bankruptcies and potential layoffs. The deal aligns with policy aims to maintain manufacturing resilience, protect skilled roles and preserve the country’s industrial base during periods of cyber risk and global uncertainty.
Chancellor Rachel Reeves welcomed the move as crucial for thousands of jobs and for sustaining a vital part of the British car industry. Critics, including opposition figures, warned that action was slow and liable to damage long term confidence in cyber resilience funding. Labour and Liberal Democrat representatives called for further measures, including broader cyber reinsurance or wage support if needed. Unions representing workers in JLR and its supply chain view the guarantee as an important first step that must translate into concrete job and skill protections.
Industry response and looking ahead
Unite, the union representing thousands of JLR workers and suppliers, described the government support as an important first step. Trade groups emphasise that the real test lies in maintaining job security, safeguarding pay, and ensuring workers have a route back to stable employment as production resumes. JLR officials say the company remains committed to a safe and orderly restart, with updates to colleagues, retailers and suppliers provided as recovery work progresses.
Context of the cyber attack and recovery
A group calling itself Scattered Lapsus$ Hunters has claimed responsibility for the August cyber incident, which disrupted a network of services and forced shutdowns across the manufacturing chain. The attack has prompted questions about the UKs cyber resilience and the ability of large manufacturers to withstand state‑level or advanced criminal cyber threats. While progress has been made with security partners, a rapid return to full production will depend on ongoing remediation work and careful risk management to prevent a fresh disruption as plants ramp up activity again.
