A snap survey of West Midlands businesses has laid bare the financial and operational strain attributable to Jaguar Land Rover’s prolonged shutdown following a significant cyber attack.
The research, carried out jointly by the Black Country, Greater Birmingham and Coventry and Warwickshire Chambers of Commerce, surveyed 84 businesses employing greater than 29,700 people across the region. It found that 77% had experienced a negative impact, with 44% describing it as “significant”.
Almost half (45%) of firms reported serious financial repercussions, including lost revenue, increased costs and delays in customer payments. The survey revealed that 79% of respondents were directly inside JLR’s supply chain, while 18% weren’t but were still hit by the knock-on effects.
Jaguar Land Rover announced on September 26 it was bringing parts of its digital operations back online because the automobile maker continues to get better from the severe cyber attack that forced it to halt production last month.
Crucially, it has restarted its parts logistics operation to support its franchised dealerships with service and repair jobs, a few of which have needed to be postponed since JLR’s cyber crisis began.
But its factories remain closed and production just isn’t expected to resume until at the least October, prolonging the financial strain on its network of around 700 suppliers
Because the disruption continues, the business survey outlined what number of suppliers are being forced into making tough decisions. Greater than a 3rd (35%) have reduced staff hours or placed employees on temporary leave, while 14% have already made redundancies. An additional 17% are looking for emergency financial support from banks.
Sarah Moorhouse, chief executive of the Black Country Chamber of Commerce, said the impact stretches well beyond JLR itself. “The Black Country’s automotive supply chain employs 13,000 people so the ripple effects of this cyber-attack are being felt right across our business community,” she said.
“What these initial survey results show is that this isn’t nearly JLR – it’s concerning the suppliers, manufacturers and repair providers that make the West Midlands the powerhouse of UK automotive production.
“We’re talking to our members and to local and national government concerning the support which must be put in place. The survey showed that over half of the companies who responded wish to see a financial support package. It’s telling that 18% of those corporations are calling for specific protection from exposure under the Insolvency Act until the crisis ends.”
The Chambers said the survey findings will likely be shared with JLR and regional and national policymakers to assist shape possible support measures for affected firms.
This Article First Appeared At www.am-online.com
