Blog

The hack of Jaguar Land Rover has cost the UK economy an estimated £1.9bn, potentially making it the most costly cyber-attack in British history, a cybersecurity body has said.

A report by the Cyber Monitoring Centre (CMC) said losses could be higher if there were unexpected delays to the return to full production at the carmaker to levels before the hack took place at the end of August.

JLR was forced to shut down systems across all of its factories and offices after realising the extent of the penetration. The carmaker, Britain’s biggest automotive employer, only managed a limited restart in early October and is not expected to return to full production until January.

As well as crippling JLR, the hack has affected as many as 5,000 organisations across Britain, given the wide extent of the carmaker’s complex supply chain. While JLR has been able to rely on its large financial buffers, smaller suppliers were immediately forced to lay off thousands of workers and contend with a painful pause in cashflow.

“This incident appears to be the most economically damaging cyber event to hit the UK, with the vast majority of the financial impact being due to the loss of manufacturing output at JLR and its suppliers,” the CMC’s report said.

The CMC is an independent non-profit organisation made up of industry specialists including the former head of Britain’s National Cyber Security Centre, Ciaran Martin. Martin said it looked like the most costly UK attack “by some distance”, and added that organisations needed to work out how to react if vital networks were disrupted.

JLR, which is owned by India’s Tata Group, will report its financial results in November. A spokesperson for the carmaker declined to comment on the report.

The luxury carmaker has three factories in Britain that together produce about 1,000 vehicles a day. The incident was one of several high-profile hacks to affect large UK companies this year. Marks & Spencer lost about £300m after a breach in April forced the retailer to suspend its online services for two months.

JLR, which analysts estimated was losing about £50m a week from the shutdown, was promised a £1.5bn loan guarantee by the UK government in late September to help it support suppliers. However, before receiving that cash, the carmaker launched its own efforts to support its supply chain, paying for parts upfront.

The CMC, which is funded by the insurance industry and categorises the financial impact of significant cybersecurity incidents affecting British businesses, ranked the JLR hack as a category 3 systemic event, out of a scale of five.

The £1.9bn estimate “reflects the substantial disruption to JLR’s manufacturing, to its multi-tier manufacturing supply chain, and to downstream organisations including dealerships”, the report said.