JLR cyber attack impact 'may last for six months'

The cyber attack is said to be the worst the UK has suffered, with estimates it will cost the UK economy £1.6bn

Supply chain firms for Jaguar Land Rover (JLR) say they face up to six months of credit difficulties after the cyber attack on the car company.

The hack has been described as the most economically damaging cyber event in UK history, costing an estimated £1.9bn.

Jonathan Dudley, head of manufacturing and accountant at Crowe, said small, owner-managed firms that supply JLR have been hit hardest.

"The vast majority of them are calling for more help," he said. "Businesses say they can't see cash flow coming right for at least six months - that's serious."

"That money will take time to trickle down and those businesses aren't big international businesses," Mr Dudley continued.

"They're owner-managed businesses, they're family businesses, reliant on their ownership and the livelihoods of their ownership and the assets of their ownership to get them through this time."

Jonathan Dudley is concerned about the lasting effects on smaller businesses

After the attack on 31 August, dealer systems were only available intermittently and suppliers faced cancelled or delayed orders, which contributed to their losses.

The impact has been felt across the supply chain, particularly in Coventry and Warwickshire, where many firms rely on JLR contracts.

The Institute of Chartered Accountants in England and Wales has found business confidence in the West Midlands has fallen significantly since the attack, making it the second lowest in the UK.

'Lights are back on'

According to Mr Dudley, a chamber of commerce survey showed an "overwhelming" number of firms are still experiencing difficulty, despite £1.5bn of government-backed loan guarantees.

He warned that although JLR staff are now back at work, they are "working off built up stocks at the moment" and smaller suppliers have yet to feel the benefit.

David Roberts, founder and chairman of Evtec in Coventry, said production had "improved dramatically" since its factory reopened.

"At Evtec the lights are back on, the systems are up and running, but more importantly every one of our people is back at work," he said.

David Roberts, the chairman of Evtec which supplies parts to Jaguar Land Rover, said production has "improved dramatically"

But Mr Roberts added that while Evtec has managed to return to pre-attack sales levels, smaller companies are still struggling.

"Obviously, the industry was killed for seven weeks and that does impact businesses," he said.

"Smaller businesses are still struggling and I think the government missed the deeper financial shock to tier two and tier three suppliers who suddenly had no income."

He said the UK needs "ready-made mechanisms for temporary relief" in case of cyber attacks.

"If we don't develop that kind of safety net in the UK, I'm afraid investment decisions will drift away from Britain and that's a problem we have to fix," he explained.

"Large global brands are constant targets for these kind of attacks. It's not a question of if, it's a problem of when.

"We know the technology exists here in the UK, particularly in the West Midlands, but we need the government framework."