JLR hack drove UK economy into unexpected contraction in September
Ouch! The UK economy shrank in September, today’s GDP report shows, as the cyber-attack on Jaguar Land Rover hammered activity in the manufacturing sector.
UK GDP fell by 0.1% in September, following no growth in August (revised down from a previous estimate of growth of 0.1%) and an unrevised fall of 0.1% in July.
That’s an unwelcome surprise, City economists had expected GDP to be unchanged in the month.
Production output fell by 2.0% in September, mainly because of a 28.6% decline in the manufacture of motor vehicles, trailers and semi-trailers – as the JLR ground to a halt for the whole month, disrupting its supply chain. That knocked 0.17 percentage points from monthly GDP.
Services and construction output both increased by 0.2% in the month.
September’s contraction pulled growth down to just 0.1% across the third quarter of the year (see earlier post).
ONS Director of Economic Statistics Liz McKeown says:
“Across the quarter as a whole manufacturing drove the weakness in production. There was a particularly marked fall in car production in September, reflecting the impact of a cyber incident, as well as a decline in the often-erratic pharmaceutical industry.
Updated at 02.26 EST
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Looking over the longer term, the ONS says, GDP is estimated to have grown by 1.3% in the three months to September 2025, compared with the same three months a year ago.
Over this period services grew by 1.6%, construction grew by 1.5% whereas production fell by 0.9% – as the JLR cyber-attack hit output hard in September.
Compared with the same month a year ago, GDP is estimated to be 1.1% higher in September 2025.
A chart showing UK GDP Illustration: ONSShare
The UK economy is clearly struggling to maintain momentum, warns Ruth Gregory, deputy chief UK economist at Capital Economic.
Gregory tells clients this morning:
Much of the 0.1% m/m fall in September and muted 0.1% q/q rise in GDP in Q3 was due to the hit to manufacturing activity caused by the Jaguar Land Rover cyber-attack, which will be reversed in Q4.
Even so, the big picture is that the economy is struggling to gain decent momentum in the face of higher taxes and soft overseas activity. And with tax rises in the upcoming Budget likely to trim GDP by around 0.2% in 2026, there is little reason to think that GDP growth will accelerate much from here.
ShareSlowest quarterly growth since last recession as economy loses steam
The meagre 0.1% growth recorded in July-September appears to be the slowest quarterly growth since the short recession in the second half of 2023.
A chart showing UK GDP by quarter Illustration: ONS
Lindsay James, investment strategist at wealth manager Quilter, warns that the economy is ‘badly losing steam’:
“Today’s GDP release confirms what recent data has hinted at – the UK economy is struggling to maintain momentum as we head towards year-end. Monthly growth has fallen by 0.1%, with August’s figure also downgraded to no growth.
The three-month rate shows growth of just 0.1%, a step down from the 0.7% seen in Q1 and the 0.3% delivered in Q2, with industrial output back in contraction in September, partly due to the Jaguar Land Rover cyber-attack issues.
This paints a picture of an economy that started 2025 strongly but is now badly losing steam just as the Chancellor prepares for a pivotal Autumn Budget. Her next move will be critical if she is to recover Labour’s economic growth mission and prevent any whispers of a recession looming.
ShareChart: How growth has slowed in recent months
Although the Jaguar Land Rover attack clearly caused a drop in activity (its UK factories were closed through September), there has also been a wider slowdown.
This chart show how the rolling three month estimate of growth has weakened since the spring:
A chart showing UK GDP Illustration: ONSShareJLR hack drove UK economy into unexpected contraction in September
Ouch! The UK economy shrank in September, today’s GDP report shows, as the cyber-attack on Jaguar Land Rover hammered activity in the manufacturing sector.
UK GDP fell by 0.1% in September, following no growth in August (revised down from a previous estimate of growth of 0.1%) and an unrevised fall of 0.1% in July.
That’s an unwelcome surprise, City economists had expected GDP to be unchanged in the month.
Production output fell by 2.0% in September, mainly because of a 28.6% decline in the manufacture of motor vehicles, trailers and semi-trailers – as the JLR ground to a halt for the whole month, disrupting its supply chain. That knocked 0.17 percentage points from monthly GDP.
Services and construction output both increased by 0.2% in the month.
September’s contraction pulled growth down to just 0.1% across the third quarter of the year (see earlier post).
ONS Director of Economic Statistics Liz McKeown says:
“Across the quarter as a whole manufacturing drove the weakness in production. There was a particularly marked fall in car production in September, reflecting the impact of a cyber incident, as well as a decline in the often-erratic pharmaceutical industry.
Updated at 02.26 EST
UK economy grew 0.1% in July-September
Newsflash: Growth across the UK economy has slowed in the third quarter of the year.
UK GDP expanded by just 0.1% in July-September – down from 0.3% in April-June – a weak pace of growth.
And if you adjust for population, there was no growth at all – with real GDP per head unchanged.
The services sector grew by 0.2%, while construction expanded by 0.1% – and the production sector contracted by 0.5%.
While we wait for the UK GDP report in 15 minutes, we also have evidence that the UK housing market cooled in October.
Buyer demand, sales activity and new instructions all fell further into negative territory, the Royal Institution of Chartered Surveyors reports this morning.
Surveyors strongly attribute the slowdown to mounting uncertainty ahead of the forthcoming Autumn Budget and potential tax-raising measures, RICS says.
ShareIntroduction: It’s UK GDP Day
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
The UK economy will be under the microscope today, less than two weeks before a crucial budget.
The latest GDP data, to be released at 7am, will show how the economy fared in September, and over the third quarter of this year. Economists predict small quarterly growth – of perhaps 0.2%, down from 0.3% in April-June.
September could be trickier, though; the economy may have felt the chill of pre-budget uncertainty. It certainly faced disruption in the auto sector, with carmaker Jaguar Land Rover forced to suspend production for the month due to a cyber attack.
The JLR hack drove car production at British factories to the lowest level for a September since 1952, which will surely hit the wider measure of activity.
A poor GDP report will intensify the criticism of chancellor Rachel Reeves’s handling of the economy, as she prepares her budget statement on 26 November.
Weak growth could also spur the Bank of England towards cutting interest rates again, with a December cut already looking quite likely….
The agenda
7am GMT: UK GDP report for September, and Q3 2025
7am GMT: UK trade report for September
9am GMT: IEA’s monthly oil market repor
Noon BST: Bank of England policymaker Megan Greene: Panellist at Chatham house event ‘Is the age of central bank independence under threat?’