£1.5bn lifeline for Jaguar Land Rover suppliers to shield thousands of jobs

A £1.5 billion loan-guarantee scheme was unveiled to keep afloat small firms that supply Jaguar Land Rover, a step designed to protect thousands of jobs after a cyberattack paused production at Britain’s biggest car maker.

The plan, announced by Business Secretary Peter Kyle on the eve of the Labour Party conference, is targeted at suppliers across the United Kingdom that employ roughly 120,000 people and had feared imminent collapse as JLR suspended operations last month. The government said the scheme would help secure financing so JLR could advance funds to key suppliers and sustain them until production restarts next month. The effort covers the West Midlands, Merseyside and other regions, reflecting the geographic spread of JLR’s supplier network.

The move follows mounting concern that some of the small firms that feed JLR’s Solihull and Wolverhampton plants in the West Midlands, and Halewood in Merseyside, were within days of failing without intervention. In recent days, parts of JLR’s IT systems have come back online, enabling the company to begin clearing a backlog of supplier payments as part of its broader recovery programme.

Chancellor of the Exchequer Rachel Reeves hailed the measure as protecting jobs in what she described as a jewel in the crown of the economy, stating that thousands of roles could be safeguarded with up to £1.5 billion in additional private finance.

Reaction from the opposition was cautious. Tory business spokesman Andrew Griffith welcomed the approach but criticized ministers for being too slow to act. He urged Labour to pursue a cyber reinsurance scheme to shield British manufacturers from state-backed actors in a more dangerous global environment, saying Britain’s firms deserve a government that focuses on business and avoids distractions.

Final details of the loan scheme were still to be worked out, but officials suggested the arrangement would enable JLR to secure commercial lending to fund payments to suppliers and bridge the period until full production resumes. The recovery effort comes as JLR has signaled a path back to normal operations, with production disruption tied to the earlier cyberattack now easing as the company progresses with its restoration program.