Jaguar Land Rover (JLR) has disclosed a substantial pre-tax loss of £310 million for its third quarter, marking a stark reversal from the £523 million profit achieved during the same period the previous year. This dramatic downturn is largely attributed to a severe cyber attack that disrupted operations last autumn.
Cyber Incident Triggers Production Shutdown and Financial Strain
The cyber attack, which occurred in the autumn, resulted in an additional £64 million in direct costs for the carmaker. More critically, it forced a complete five-week halt in production across JLR's UK factories, beginning on 1 September. This prolonged shutdown had a devastating impact on the company's sales volumes and overall revenue.
Revenue Plummets as Factories Stand Idle
As a direct consequence of the production stoppage, JLR's revenues fell sharply by 39 per cent year-on-year, dropping to £4.5 billion for the final three months of 2023. Normal production levels were not restored until mid-November, underscoring the severity and duration of the operational disruption caused by the security breach.
Compounding Challenges: Tariffs, Model Transitions, and Market Pressures
Beyond the cyber attack, JLR's financial performance was further weakened by several other significant factors. Ongoing US trade tariffs continued to exert pressure, while the planned phase-out of older Jaguar models in preparation for new vehicle launches also contributed to the losses. Additionally, deteriorating market conditions in China presented another substantial challenge for the automotive group during this period.
Optimism for Recovery Despite Quarterly Setback
Despite these considerable setbacks and the resulting quarterly loss, Jaguar Land Rover has expressed confidence in a marked improvement for its final quarter. The company anticipates that as production has returned to normal and strategic adjustments take effect, its financial performance will show significant recovery in the coming months.
