Business
JLR shutdown after cyber hack drives slump in UK car production
The five-week shutdown of Jaguar Land Rover’s (JLR) factories following a cyber-attack drove car production down by more than a quarter in September.
JLR facilities did not produce a single vehicle last month, after the cyber-attack forced the car maker to shut down its IT systems and halt its global manufacturing operations, including at its three UK plants.
Overall UK car production fell by 27% with just over 51,000 made last month, data from the Society of Motor Manufacturers and Traders (SMMT) showed.
It is the lowest number of cars made in any September in the UK since 1952, including the pandemic, the SMMT said.
The JLR cyber-attack was largely responsible for the slump in UK car production, the SMMT said, because other manufacturers reported stable figures for the month.
The attack is also estimated to cost £1.9bn and be the most economically damaging cyber event in UK history, according to research published on Tuesday.
The Cyber Monitoring Centre (CMC) found 5,000 businesses have been affected by the event and a full recovery will not occur until January 2026.
JLR said production across sites in Solihull, Wolverhampton and Halewood was returning in a phased approach.
The maker of the Jaguar I-Pace and Range Rover Sport is the second-largest car producer by volume in the UK after Nissan.
Overall, total vehicle production slumped by 35.9% in September compared to a year ago to about 54,300 vehicles.
The SMMT chief executive Mike Hawes said: “September’s performance comes as no surprise given the total loss of production at Britain’s biggest automotive employer following a cyber incident.
“While the situation has improved, the sector remains under immense pressure,” he added.
The majority of vehicles made in the UK are shipped overseas, and exports in September also slumped – down 24.5% – with the EU, US, Turkey, Japan and South Korea the top five destinations.
This year so far UK car and van factories have made 582,250 vehicles, which is 15.2% lower than at the same point in 2024.
The five-week JLR shutdown was a “severe, but short-term issue” for the overall industry, the boss of Autotrader Ian Plummer said.
“It’ll be a bit like Covid, where after the shutdown and delays end, there’s a surge in demand and sales,” he said.
Mr Plummer, who runs the UK’s biggest car-selling platform said, JLR brands had risen to have the highest number of monthly sales leads on Autotrader, “so there is demand out there, even as the pipeline is currently stuck”.
The SMMT’s Mr Hawes also said a recent ambition from the UK government to help foster a resurgence in domestic car production to 1.3m vehicles a year is in doubt if the chancellor Rachel Reeves ends tax breaks offered to Employee Car Ownership Schemes (ECOS).
“The industry is calling for rapid interventions to shore up its competitiveness,” he said.
Keeping manufacturers’ ECOS schemes would be “an immediate relief”, he said, and bringing forward other interventions including programmes to bolster supply chain resilience “would further boost the sector”.
Interest rates are widely expected to remain at 3.75% as Bank of England policymakers prioritise curbing above-target inflation while also monitoring economic growth, according to expert analysis.
The Bank’s Monetary Policy Committee (MPC) is anticipated to leave borrowing costs unchanged when it announces its latest decision on Thursday, marking its first interest rate setting meeting of the year.
This follows a rate cut delivered before Christmas, which was the fourth such reduction.
At the time, Governor Andrew Bailey noted that the UK had “passed the recent peak in inflation and it has continued to fall”, enabling the MPC to ease borrowing costs. However, he cautioned that any further cuts would be a “closer call”.
Since that decision, official data has revealed that inflation unexpectedly rebounded in December, rising for the first time in five months.
The Consumer Prices Index (CPI) inflation rate reached 3.4% for the month, an increase from 3.2% in November, with factors such as tobacco duties and airfares contributing to the upward pressure on prices.
Economists suggest this inflation uptick is likely to reinforce the MPC’s inclination to keep rates steady this month.
Philip Shaw, an analyst for Investec, stated: “The principal reason to hold off from easing again is that at 3.4% in December, inflation remains well above the 2% target.”
He added: “But with the stance of policy less restrictive than previously, there are greater risks that further easing is unwarranted.”
Shaw also highlighted other data points the MPC would consider, including gross domestic product (GDP), which saw a return to growth of 0.3% in November – a potentially encouraging sign for policymakers.
Matt Swannell, chief economic advisor to the EY ITEM Club, affirmed: “Keeping bank rate unchanged at 3.75% at next week’s meeting looks a near-certainty.”
He noted that while some MPC members who favoured a cut in December still have concerns about persistent wage growth and inflation, recent data has not been compelling enough to prompt back-to-back reductions.
Edward Allenby, senior economic advisor at Oxford Economics, forecasts the next rate cut to occur in April.
He explained: “The MPC will continue to face a delicate balancing act between supporting growth and preventing inflation from becoming entrenched, with forthcoming data on pay settlements likely to play a decisive role in shaping the next policy move.”
The Bank’s policymakers have consistently voiced concerns regarding the pace of wage increases in the UK, which can fuel overall inflation.
India’s budget focuses on infrastructure and defence spending and tax breaks for data-centre investments.
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New Income Tax Act 2025 to come into effect from April 1, key reliefs announced in Budget 2026
New Delhi: Finance Minister Nirmala Sitharaman on Sunday said that the Income Tax Act 2025 will come into effect from April 1, 2026, and the I-T forms have been redesigned such that ordinary citizens can comply without difficulty for ease of living.
The new measures include exemption on insurance interest awards, nil deduction certificates for small taxpayers, and extension of the ITR filing deadline for non-audit cases to August 31.
Individuals with ITR 1 and ITR 2 will continue to file I-T returns till July 31.
“In July 2024, I announced a comprehensive review of the Income Tax Act 1961. This was completed in record time, and the Income Tax Act 2025 will come into effect from April 1, 2026. The forms have been redesigned such that ordinary citizens can comply without difficulty, for) ease of living,” she said while presenting the Budget 2026-27
In a move that directly eases cash-flow pressure on individuals making overseas payments, the Union Budget announced lower tax collection at source across key categories.
“I propose to reduce the TCS rate on the sale of overseas tour programme packages from the current 5 per cent and 20 per cent to 2 per cent without any stipulation of amount. I propose to reduce the TCS rate for pursuing education and for medical purposes from 5 per cent to 2 per cent,” said Sitharaman.
She clarified withholding on services, adding that “supply of manpower services is proposed to be specifically brought within the ambit of payment contractors for the purpose of TDS to avoid ambiguity”.
“Thus, TDS on these services will be at the rate of either 1 per cent or 2 per cent only,” she mentioned during her Budget speech.
The Budget also proposes a tax holiday for foreign cloud companies using data centres in India till 2047.
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