UK Government's £1.5bn Support for JLR's Supply Chain 'Left Untouched'
Ministers claim to have helped Jaguar Land Rover (JLR) weather a crippling cyber-attack by guaranteeing a £1.5bn loan facility, but suppliers are questioning the government's involvement after no money was drawn down from the funds.
The carmaker was forced to shut all its factories for over a month due to the hack, causing widespread disruption to the UK automotive industry and leaving thousands of workers without pay. Suppliers also faced financial pressure as they were unable to receive payments from JLR, with many laying off staff to save cash.
In an effort to alleviate this crisis, the government announced that it would guarantee 80% of any potential debt by JLR if it defaulted on the loan. This was seen as a significant gesture of support for the company's supply chain, but suppliers are now claiming that they have received no financial benefits from the loan facility.
"We've done nothing," said an executive at one parts manufacturer, who expressed anger over the government's messaging which appeared to take credit for helping JLR and its suppliers. "The idea that the government played a blinder in bailing out JLR is utter nonsense."
Despite the loan guarantee being touted as a significant support measure, it appears that none of the funds have been drawn down by JLR or distributed to its suppliers. Instead, the carmaker used its existing cash reserves to implement a scheme to help suppliers.
While this may have helped JLR marginally by reducing the risk of breaching other banking agreements, suppliers are still feeling the pinch as they face payment deadlines in the coming weeks. The Confederation of British Metalforming (CBM), a lobby group representing many of JLR's suppliers, has called for financial support to be accelerated.
"From 1 September, no matter when you get paid, there's no sales to invoice," said Stephen Morley, the president of the CBM. "Depending on your payment terms, come 1 November the majority of invoices would have been due. This is a critical pinch point as there is nothing to invoice."
While recovery efforts are reportedly going better than expected overall, suppliers are still facing significant challenges and the CBM has emphasized that work needs to be done to support the supply chain further.
The government's handling of the situation has raised questions about its effectiveness in supporting industry players during times of crisis. As the carmaker ramps up production in the coming weeks, it remains to be seen whether this loan guarantee will ultimately prove to be a meaningful gesture of support or simply a publicity stunt.
Ministers claim to have helped Jaguar Land Rover (JLR) weather a crippling cyber-attack by guaranteeing a £1.5bn loan facility, but suppliers are questioning the government's involvement after no money was drawn down from the funds.
The carmaker was forced to shut all its factories for over a month due to the hack, causing widespread disruption to the UK automotive industry and leaving thousands of workers without pay. Suppliers also faced financial pressure as they were unable to receive payments from JLR, with many laying off staff to save cash.
In an effort to alleviate this crisis, the government announced that it would guarantee 80% of any potential debt by JLR if it defaulted on the loan. This was seen as a significant gesture of support for the company's supply chain, but suppliers are now claiming that they have received no financial benefits from the loan facility.
"We've done nothing," said an executive at one parts manufacturer, who expressed anger over the government's messaging which appeared to take credit for helping JLR and its suppliers. "The idea that the government played a blinder in bailing out JLR is utter nonsense."
Despite the loan guarantee being touted as a significant support measure, it appears that none of the funds have been drawn down by JLR or distributed to its suppliers. Instead, the carmaker used its existing cash reserves to implement a scheme to help suppliers.
While this may have helped JLR marginally by reducing the risk of breaching other banking agreements, suppliers are still feeling the pinch as they face payment deadlines in the coming weeks. The Confederation of British Metalforming (CBM), a lobby group representing many of JLR's suppliers, has called for financial support to be accelerated.
"From 1 September, no matter when you get paid, there's no sales to invoice," said Stephen Morley, the president of the CBM. "Depending on your payment terms, come 1 November the majority of invoices would have been due. This is a critical pinch point as there is nothing to invoice."
While recovery efforts are reportedly going better than expected overall, suppliers are still facing significant challenges and the CBM has emphasized that work needs to be done to support the supply chain further.
The government's handling of the situation has raised questions about its effectiveness in supporting industry players during times of crisis. As the carmaker ramps up production in the coming weeks, it remains to be seen whether this loan guarantee will ultimately prove to be a meaningful gesture of support or simply a publicity stunt.
I'm super frustrated that the government's £1.5bn loan facility for JLR hasn't been helping suppliers at all... like what was the point of even having it then? 
It sounds like JLR just used its own cash to help suppliers and now everyone's still in the dark about how they're going to pay their bills. 
This is a major pinch point for these small businesses and it's not fair that they're stuck with no sales to invoice from 1 Sept onwards... I mean, what are they supposed to do? 
The government needs to step up and provide some real support instead of just touting this loan guarantee as some kind of hero move 
[A picture of a guy looking confused with a thought bubble saying "Wait, what?"] 
Suppliers are like "Hey gov, we didn't get paid 
JLR used cash reserves to help suppliers, but still not enough 
[A GIF of a clock running out] Suppliers facing payment deadlines in weeks, hope comes in November 
so the gov is giving jlr £1.5bn to prevent cyber attack but suppliers are still struggling 
these suppliers have been laying off staff & it's still all downhill for them 
. The fact that no money has been drawn down does make you wonder if it was all just a bit of PR spin 
. I mean, surely the government wants to be seen as supportive of JLR and its suppliers, right? But at the same time, it's not like the loan guarantee is going to magically fix everything... 
. What was the point of even announcing it then? 
The only thing that makes sense is that they wanted to make JLR look good so they could say "look, we helped 'em" 
. Newsflash: just because you promise to do something doesn't mean you actually follow through on it 
. Can't believe the gov didn't deliver here 
.
. The supplier exec got it spot on - it's total nonsense that they're taking credit for helping JLR without actually doing anything to support the suppliers 
!
. like wut even is the point of guaranteeing 80% debt relief if u ain't goin to use it?! 
, but really it just feels like more of the same old empty promises 
. I mean, who comes up with these guarantees anyway? 
.
This whole situation reeks of empty promises and I want to see some concrete evidence before I believe it was all worth it. 
. They're saying they helped the company weather a cyber-attack, but it seems like just a PR move. Suppliers are still struggling to get paid and have no financial benefits from the loan guarantee. It's not exactly helping them out in the short term 
. The CBM is calling for financial support to be accelerated and it's clear that more needs to be done to support the supply chain 
.
.
. The gov needs to step up and provide real support, not just wave a magic wand 
. Let's see some action on this, UK!