Jaguar Land Rover to pump the brakes as Cyber Attack shuts down IT networks
Jaguar Land Rover, Britain’s iconic car manufacturer, has been in the midst of a cyber war since August 31st. Factories and production have been on pause for a month, and now they’ve announced factories will stay closed for at least another month.
Because of the nature of modern car production – intense secrecy and last minute instructions following tight deadlines – a cyber attack is particularly debilitating. Fears are growing that the company’s suppliers may go bust if the issue is not resolved. JLR are currently unable to produce cars, which is a having critical knock on effect to businesses and the supply chain and thousands of workers.
And it has now been reported that JLR’s insurance portfolio did not include cyber insurance. The overwhelming costs for this incident and shutdown will now not be covered by insurance companies, instead having far-reaching consequences upon the economy.
What was the Cyber Attack that hit Jaguar Land Rover?
A hack was discovered by JLR staff, to which they acted by shutting down the company IT systems. Staff were told to stay at home from the start of September, which lasted until September 24th.
According to reports, JLR admitted that data had been accessed by cyber criminals. They are currently having to restore their backup systems, and as of now the JLR systems are completely offline. The attack is deemed to be even more serious than similar attacks to M&S and Coop, also in 2025.
While much of the details around the attack have remained secret and unreported, independent commentators have posited that the hack is likely a ransomware attack, similar to the one that hit Redcar council Social Services, leaving a £11.3 million hole, or the Marks and Spencer cyber breach which is ongoing and cost an estimated £300 million.
In the circumstances above, the hackers used social engineering to access systems, exploiting a staff member through their email and pretending to be IT administrators. How hackers accessed JLR systems is unknown, but the attack has put manufacturers on red alert and businesses are investing in cyber security measures.
What is the impact of the Jaguar Land Rover Cyber Atack?
The business interruption is reported to be costing JLR £50million every week. The cyber attack has the potential to affect the UK economy, with Jaguar Land Rover being such a large and influential national institution. The attack has rippled through the sector, causing a decline in manufacturing nationwide.
Job losses could spiral if the pause continues. 30,000 people are directly employed by the manufacturer, and 200,000 jobs are in the supply chain. If any of the smaller businesses in the supply line falter or go under as a direct result of the pause in production, this could spell larger issues in the future.
The Government has appointed a task force to handle the fallout. Union bodies have recommended that the government arrange a furlough scheme to the workers affected by the crisis.
Jaguar Land Rover did not have cyber insurance
As reported by The Insurer, JLR did not have cyber insurance in place prior to the incident. The financial cost of the attack would normally be covered by insurance companies, had an agreement been in place, but now government ministers are considering stepping in to financially support the car manufacturer.
To stifle the financial losses, the government would buy component parts and store them for when production is back online. This measure would help to prevent the suppliers from going under, enable workers coming back to work, as well as benefiting neighbouring hospitality venues and transport links.
Jaguar Land Rover normally builds about 1,000 cars a day across it’s three UK factories. The pause in production is therefore costing JLR somewhere in the region of £7million per day. This growing financial burden, which is directly related to a lack of cyber insurance, is forcing ministers to consider utilising government-backed loans; the first of their kind. So this cyber attack incident, which could have been shouldered by insurance companies, is now likely to have widespread effects across the economy.
What lessons can be learned from the Jaguar Land Rover attack?
The JLR cyber hack is yet another example of the damage that can be done by a cyber breach. Massive cyber attacks making headline news is on the rise, and corporations and commercial businesses need to ready themselves.
Effective cyber defences are critical. This involves following safeguarding procedures, identifying risks and training staff. Social engineering techniques should be understood by key personnel as well as members of staff, with phishing attempts and fake emails being identified and used as examples. If the JLR breach has taught us anything, it’s that a cyber breach can happen at any moment, and has the potential to cause the complete interruption of business procedures.
At Romero Insurance, we have a cyber whitepaper which lays out all the key risks business owners need to be actively managing. It lists key safeguarding defences such as adequate training, multi-factor authentication and secure passwords. It also includes what to do in the event of a cyber breach, how to go into lockdown, and who should be informed. The reputational damage of a cyber attack and data breach can be severe, but effective risk management can minimise damages and speed up the recovery process.
How can comprehensive insurance protect businesses from a cyber attack?
If your business had to stop trading because of a cyber attack and the shut down of your IT systems, how long could you stay afloat before falling into financial difficulty?
Business Interruption Insurance is essential – Business Interruption Insurance is there to support you if something does go wrong and you’re unable to trade for a while. It gives you the financial backing to help get your business back up on its feet again.
At Romero Insurance, we understand that revenue streams can be disrupted long after an incident is resolved. Our business interruption policies cover the lost revenue for the period of downtime your business experienced.
Learn more about Business Interruption Insurance
Cyber Insurance is essential – Business owners and managers must ensure they are aware of cyber threats that could impact their business and do all they can to mitigate these risks. However, all risk can never be completely eliminated. Cyber insurance provides peace of mind that your business is covered financially if an incident happens.
At Romero Insurance, we are adamant that a cyber insurance policy is necessary, and will tailor the cover to the needs of the business. Choosing a dedicated broker is essential for your businesses protection and for the best service.
Learn more about Cyber Insurance
