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The government has said it will underwrite a £1.5bn loan guarantee to Jaguar Land Rover (JLR) as the car maker battles the consequences of a recent cyber-attack.
JLR had to suspend production at its UK factories for several weeks after being targeted by hackers with the shutdown expected to last until at least 1 October.
The loan, from a commercial bank, is expected to give the company’s suppliers some certainty.
The government will give its backing to the loan through the export development guarantee, which is aimed at helping UK exporters.
It will be paid back over five years.
The business secretary, Peter Kyle, said: “This cyber attack was not only an assault on an iconic British brand, but on our world-leading automotive sector and the men and women whose livelihoods depend on it.
“Following our decisive action, this loan guarantee will help support the supply chain and protect skilled jobs in the West Midlands, Merseyside and throughout the UK.”
JLR, the UK’s largest carmaker, was hit by a cyber attack on 31 August and there had been warnings that small suppliers making parts for the company could collapse without urgent financial help.
On Saturday, a report in the Sunday Times said JLR was planning to reopen its £500m engine manufacturing centre in early October, with suppliers having been put on notice that production at its Wolverhampton facility would resume on 6 October subject to tests.
JLR declined to comment on the report but a spokesperson told the Guardian: “Our teams continue to work around the clock alongside cybersecurity specialists, the NCSC and law enforcement to ensure we restart in a safe and secure manner.
“The foundational work of our recovery programme is firmly underway, and we will continue to provide regular updates to our colleagues, retailers and suppliers. We thank everyone connected with JLR for their continued support and patience.”
Commenting on the loan, the chancellor, Rachel Reeves, said: “Jaguar Land Rover is an iconic British company which employs tens of thousands of people – a jewel in the crown of our economy.
“Today we are protecting thousands of those jobs with up to £1.5bn in additional private finance, helping them support their supply chain and protect a vital part of the British car industry.”
Following the cyber attack, the company was forced to shut down most of the systems it uses to track parts, vehicles and tooling in its factories, as well as everything to do with selling its luxury Range Rover, Discovery and Defender SUVs.
JLR has subsequently restarted some IT systems and regained the ability to repay suppliers, send parts to mechanics to repair vehicles on the road, and to send finished cars at its factories to showrooms.
The business and trade secretary, Peter Kyle, said: “This cyber-attack was not only an assault on an iconic British brand, but on our world-leading automotive sector and the men and women whose livelihoods depend on it.
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“Following our decisive action, this loan guarantee will help support the supply chain and protect skilled jobs in the West Midlands, Merseyside and throughout the UK.
“We’re backing our automotive sector for the long term through our modern industrial strategy and the landmark trade deals we’ve signed to boost exports, as part of our plan for change.”
Shadow business secretary Andrew Griffith said: “Ministers have got to the right place but took too long to get there. Labour must also pick up our suggestion of a cyber reinsurance scheme to protect British businesses from state-backed actors in an increasingly dangerous world.”
Sarah Olney, the Liberal Democrat business spokesperson, said: “The government and JLR must urgently clarify whether this emergency loan is going to be enough to properly protect tens of thousands of jobs and companies in the supply chain.
“This move is of course welcome - and hopefully not too late - but the government has been too slow to act.
“The government must be prepared to provide further support, including a furlough scheme for affected workers, if needed. We must also see a plan for ensuring cyber security standards are improved so that situations like this aren’t repeated.”
With plants in Solihull and Wolverhampton in the West Midlands in addition to Halewood in Merseyside, JLR is one of the UK’s largest exporters and employs 34,000 people in its UK operations.
It also operates the largest supply chain in the UK automotive sector, much of it made up of SMEs, and employs about 120,000 people.
