Some JLR suppliers 'face bankruptcy' due to hack crisis

Jaguar Land Rover's (JLR) has been dreadful over the past two weeks, and the company's crisis shows no signs of ending. A cyber attack, which first appeared on September 1, forced the manufacturer to shut down its computer systems and close down production lines worldwide. Its factories in Solihull, Halewood, and Wolverhampton are forecast to remain idle until at least Wednesday, as the company continues to assess the damage. JLR is expected to have lost at least £50 million so far as a result of the shutdown. However, experts agree that the most significant harm is being done to its suppliers' network, many of whom are small and medium-sized enterprises. To prevent widespread job losses, the government is now under pressure for a furlough scheme to be implemented.

Anywhere up to a quarter of a million people in the supply chain for Jaguar Land Rover,

David Bailey, a professor of business economics at Birmingham Business School, told the BBC:

There's anywhere up to one quarter of the production chain.

So, if there is a knock-on effect from this closure, we may see companies going under and jobs being lost," Trump said. JLR is expected to produce more than 1,000 cars per day under normal conditions, many of which are at its UK plants in Solihull and Halewood. Engines are assembled at its Wolverhampton site. The company also has large auto factories in China and Slovakia, as well as a smaller one in India. JLR also decided to shut down ITs IT networks intentionally in order to shield them from harm, according to JLR. However, because its manufacturing and parts supply processes are highly automated, cars cannot be built. While sales were still affected by the disruption, workarounds have since been introduced to encourage dealerships to operate. Initially, the automaker appeared to be confident that the issue could be dealt quickly. It has been abundantly clear that restarting its computer systems has been a far cry from straightforward. It has already confirmed that some records have been seen or stolen, and that it has been working with the National Cyber Security Center to look into the incident. According to experts, the JLR's bill is expected to be between £5 million and £10 million a day, implying that it has already lost between £50 million and £100 million. However, the firm did not make a pre-tax loss of £2. The year's 5 billion dollars to the end of March, the year''s richest company, which means it has the financial resources to face a crisis that lasts weeks rather than months.

'Some suppliers will go bust'

JLR is ranked at the top of a pyramid of suppliers, many of whom are heavily dependent on the company as it is their primary customer. They include a substantial number of small and medium-sized businesses that don't have the capabilities to cope with a prolonged disruption to their industry. Some of them will go bust.I would not be surprised to see bankruptcies,

says Andy Palmer, a one-time senior executive at Nissan and former CEO Aston Martin. Suppliers will have to reduce their headcount in order to keep costs down, according to He.

You hold back in the first week or so of a shutdown,Palmer says. You bear those losses.But then, as the second week approaches, more details become available – and you can cut harder. So layoffs are either currently happening or are being planned.

The boss of one of the few JLR companies who preferred not to be identified,

an accounting manager

said that his company had already laid off 40 employees, nearly half of its workforce. In the meantime, other businesses are also advising their employees that they should remain at home during the hours they are not working to be

banked,

which would be offset against holidays or overtime at a later date. There is no such apprehension for a prompt return to work. According to one employee of a large supermarket based in the West Midlands, they were not planning to be back on the shop floor until September 29th. Hundreds of employees, they claim, had been told to stay at home. Temporary employees who are hired to cover occupied hours are usually the first to go when automotive companies reduce back. Permanent employees are often reluctant to be fired due to their inability to replace, and permanent employees are also difficult to replace. However, if cash balance dries up, they may have no choice but to have no option but to choose. According to Labour MP Liam Byrne, who chairs the Commons Business and Trade Committee, government assistance is needed.

What started in some online platforms is now rippling through the supply chain, threatening a cashflow crunch that might lead to a short-term shock and long-term damage,he says.We cannot afford to see a pillar of our burgeoning industrial base be affected by events beyond its control. To assist automakers, the trade union Unite has called for a furlough system to be developed. If employees are unable to do their jobs, this will require the government subsidizing employees' paychecks, effectively ending their employers' burdens.

Thousands of these workers in JLR's supply chain now find their jobs are in jeopardy as a result of the cyber attack,

Unite general secretary Sharon Graham says.

Ministers must respond quickly and introduce a furlough scheme to guarantee that essential jobs and skills are not lost while JLR and its supply chain recovers.

We acknowledge the serious impact this incident has had on JLR and their suppliers, and I know it is a worrying time for those affected. "I met with JLR's chief executive yesterday to discuss the consequences of the incident. We're also in regular contact with the company and our cyber specialists about how we can resolve this issue.