Background on Key Players and Relevance
The United Kingdom’s economy barely expanded by 0.1% in the third quarter of 2025, hampered by a cyberattack on Jaguar Land Rover in September. This slow growth comes as the UK’s Minister for Economy, Rachel Reeves, prepares the upcoming budget.
Jaguar Land Rover, owned by Indian conglomerate Tata Motors, is a significant player in the UK automotive industry with three factories that produce around 1,000 vehicles daily. The company’s recent struggles highlight the importance of its operations to the UK economy.
Key Economic Data and Analysis
According to the Office for National Statistics (ONS), the UK’s GDP grew by 0.1% in Q3, a deceleration from the previous quarter’s growth rate of 0.3%. Economists surveyed by Reuters and the Bank of England had forecast a 0.2% GDP growth for July-September.
The ONS reported a substantial 28.6% drop in motor vehicle production in September, the largest decline since April 2020 when the COVID-19 pandemic began. This drastic decrease is attributed to a cyber incident that halted production at Jaguar Land Rover, as per an SMMT industry report.
In September alone, the economy contracted by 0.1%, which was lower than anticipated flat growth.
Impact on Upcoming Budget and Economic Outlook
The recent data is unlikely to sway Reeves’ budget deliberations on November 26, as the UK economy continues to grow albeit sluggishly despite the government’s intentions to “reinvigorate” it.
However, the International Monetary Fund (IMF) projects that the UK will be the second-fastest growing G7 country in 2025, trailing only behind the United States.
Key Questions and Answers
- What was the UK’s GDP growth rate in Q3 2025? The UK’s GDP grew by a meager 0.1% in Q3, down from the previous quarter’s 0.3% growth.
- What caused the slowdown in Q3 growth? The cyberattack on Jaguar Land Rover in September significantly impacted the motor vehicle production, contributing to the slowdown.
- How did motor vehicle production fare in September? Motor vehicle production plummeted by 28.6% in September, marking the largest decline since April 2020.
- Will the recent data affect Reeves’ upcoming budget? It is unlikely, as the UK economy continues to grow albeit slowly.
- What is the IMF’s outlook for the UK economy in 2025? The IMF projects that the UK will be the second-fastest growing G7 country in 2025, behind only the United States.
