British luxury automaker Jaguar Land Rover is having the September from hell.
Earlier this month, a cyberattack forced the company to shut down its systems to prevent the issue, which disrupted its retail and manufacturing operations, from spreading further.
The attack led the company to close its three factories in Britain, which produce about 1,000 cars a day. It has told many of its 33,000 staff to stay home during the process.
Since then, the company has set, and missed, self-imposed deadlines to restart operations.
On September 16, Jaguar confirmed it will keep its UK plants closed until Wednesday, September 24.
On Tuesday, September 23, the company said it would keep all of its global factories — including ones in China, Slovakia, India, and Brazil — closed until at least October 1.
“We have taken this decision as our forensic investigation of the cyber incident continues, and as we consider the different stages of the controlled restart of our global operations, which will take time,” the company said in a statement.
While the company has not explained how the incident occurred, new reporting suggests it may have to pay a heavy price for the disruption.
Jaguar Land Rover let cyber insurance lapse before cyberattack
Jaguar Land Rover, which is owned by India’s Tata Motors, failed to finalize a cyber insurance deal brokered by insurance provider Lockton before the attack, according to Reuters.
If this is the case, JLR could lack direct coverage for an incident that could cost it billions.
For the quarter ended in June, Jaguar Land Rover reported revenue of £6.6 billion ($8.8 billion) with a profit of £351 million ($472 million).
Based on those numbers, a month-long shutdown could cost billions of dollars and put a serious strain on the company’s profit margin, and without insurance, the company could be on the hook for all of those losses.
One analyst estimates that JLR has lost more than 1 billion ($1.36 billion in revenue) since the attack.
“JLR have the resources to withstand this financial shock, and their employees are still getting paid during the downtime, but their supply chain is now severely impacted by this — they’re not shipping parts, so they’re not getting paid,” automotive analyst Charles Tennant told Coventry Live.
What’s next for Jaguar Land Rover following the cyberattack
On Sept. 23, UK business secretary Peter Kyle was scheduled to visit JLR and meet some of its suppliers.
Meanwhile, other government officials including Tipton and Wednesbury Labour MP Antonia Bance are advocating for a government loan program to help shore up JLR and its supply chain.
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“We’re seeing production lines closed across the West Midlands and further afield and suppliers having a real cash crunch,” Bance said, according to the Guardian.
British newspaper The Telegraph reported earlier this week that the production shutdown could actually last until November, although JLR denies this.
“This cyber incident is taking JLR longer to resolve than many people probably thought and will mean they will have lost the best part of a month’s global production costing over one billion pounds GBP in lost sales revenue,” Tennant said.