Cyberattack on Jaguar Land Rover Stalls UK Economic Growth in Q3 2025

The United Kingdom's economic growth nearly stalled in the third quarter of 2025, with Gross Domestic Product (GDP) increasing by just 0.1%, down from 0.3% in the previous quarter. This slowdown is largely attributed to a significant cyberattack on Jaguar Land Rover (JLR), the nation's largest automaker, which led to a prolonged production halt.

The Office for National Statistics (ONS) reported that the modest GDP growth in Q3 2025 fell short of market expectations of 0.2%. The production sector contracted by 0.5%, with manufacturing output decreasing by 0.8%. Notably, the manufacture of motor vehicles, trailers, and semi-trailers plummeted by 10.3%, significantly impacting overall production figures. (ons.gov.uk)

The cyberattack on JLR began on August 31, 2025, prompting the company to pause production on September 1. The disruption extended for over five weeks, with operations resuming in early October. This incident is considered one of the most damaging cyberattacks in British history, with estimated economic damages reaching £1.9 billion. (en.wikipedia.org)

The attack had a cascading effect on JLR's extensive supply chain, affecting numerous suppliers and leading to financial strain among smaller companies. Some suppliers reported being close to exhausting their financial reserves due to the prolonged production halt. (reuters.com)

In response to the crisis, the British government pledged a £1.5 billion ($2 billion) loan guarantee to support JLR and its supply chain. This financial aid, facilitated through UK Export Finance, aims to sustain the supply chain and safeguard skilled jobs in the region. Business Minister Peter Kyle emphasized the importance of this support package, stating that the cyberattack posed a direct threat to the UK's leading automotive sector. (reuters.com)

The economic slowdown and the impact of the cyberattack influenced financial markets. The FTSE 100 Index fell by 0.6%, ending a three-day streak of record highs. Financial stocks, notably 3i Group, dropped 14.6% after expressing caution about new investments. Energy shares declined by 1.1% amid concerns over oil oversupply. Conversely, precious metal miners surged 8.2% as gold prices reached a three-week high. (apnews.com)

Treasury Chief Rachel Reeves acknowledged the cyberattack’s impact, warning of likely tax hikes to manage national debt, reduce hospital wait times, and combat inflation. An increase in the basic income tax is expected, despite it breaking a long-standing Labour manifesto pledge. (apnews.com)

The cyberattack on JLR underscores the vulnerability of critical industries to cyber threats and highlights the potential for significant economic repercussions. The incident has prompted discussions on the need for enhanced cybersecurity measures within the manufacturing sector and the importance of robust contingency planning to mitigate such risks.

As the nation approaches the November 26 budget, policymakers face the challenge of addressing these vulnerabilities while fostering economic resilience.