Government mulls financial support for JLR supply chain firms

The government is looking at ways to financially support the companies in Jaguar Land Rover’s (JLR) supply chain.

JLR halted car production at the end of August after a cyber attack forced it to shut down its IT networks. Its factories remain suspended until next month at the earliest.

Fears are growing that some suppliers, in particular the smaller firms who solely rely on JLR’s business, could go bust without support.

One idea being explored is the government buying the component parts the suppliers build, to keep them in business until JLR’s production lines are up and running again.

Unions had called for a Covid-style furlough scheme, but ministers have ruled this out given its likely cost, sources have told the BBC.

Another option being considered is providing government-backed loans to suppliers, though this is understood to be out unpopular with suppliers.

The purchase and stockpiling of car parts by the government is also an option on the table, but this would present considerable logistical challenges.

JLR’s manufacturing process relies on the right part arriving at the right place, at the right time.

However, industry experts agree doing nothing risks firms in the supply chain, which employs tens of thousands of workers, facing bankruptcy.

The Business and Trade Select Committee is due to meet on Thursday afternoon to hear testimonies from businesses in JLR’s supply chain.

This evidence will be shared with the government afterwards.