Jaguar Land Rover Closure
The largest automobile manufacturer in Great Britain, Jaguar Land Rover (JLR), is facing a longer closure of its global activities. The company has announced an extension of the current closure, which began on August 31, to at least October 1st. This extension is estimated to cost JLR ten million pounds per day in sales.
Impact on the Company and Supply Chain
The closure has raised great concerns about the companies and jobs in the supply chain. More than 33,000 people work directly for JLR in Great Britain, and an estimated 200,000 others are employed by several hundred companies in the supply chain. The "Just-in-Time" fade of automotive production means that many suppliers only had a short notice before JLR’s closure and no incentive to resume production until it is clear when JLR will be back in production.
Effects on Suppliers
Industry sources estimate that around 25% of the suppliers have already taken steps to pause and relieve employees, many of whom have to work through "banking hours" in the future. Another quarter is expected to make decisions this week after JLR’s announcement that production would take a break until at least Wednesday. Many suppliers are at risk, especially small and medium-sized companies, and some have already released people.
Financial Support
The government has been addressed by unions to introduce a vacation program to protect jobs in the supply chain. However, since JLR made profits of 2.2 billion GBP last year, the company is under pressure to support its suppliers. The industrial organization, the Society of Motor Manufacturers and Traders, said that while government support should be the last resort, it should not be off the table.
Cyber Attack
JLR has not delivered any details of the type of attack, but it is assumed to be a result of weakened security measures. The dealers were not only able to interrupt vehicle production, but also could not register vehicles or order spare parts, and even diagnostic software for analyzing individual vehicles was affected. The speculation focused on the susceptibility of IT support desk tables for secret activities of hackers, which pretend to be an employee for access to passwords as well as "phishing" or other digital means of access to systems.
Investigation and Resilience Risks
JLR is carrying out a "forensic" investigation of how the "controlled restart" should be staged in global production. Officials from the National Cyber Security Center are supporting JLR in their investigation, while officials and ministers of the Department of Economics and International Trade are being kept up to date. The JLR closure raises concerns about the resilience of British companies, which are now more susceptible to cyber threats due to their larger digital operations and global organizations.
