The cyber attack on Jaguar Land Rover (JLR), which halted production for nearly six weeks at its sites, cost the company roughly £200m, it has been revealed.

Latest accounts released on Friday showed “cyber-related costs” were £196m, which does not include the fall in sales.

Profits took a nose dive, falling from nearly £400m (£398m) a year ago to a loss of £485m in the three months to the end of September.

Money blog: Apple launches £220 iPhone ‘sock’ today – fans are divided

Revenues dropped nearly 25% and the effects may continue as the manufacturing halt could slow sales in the final three months of the year, executives said.

The impact of the shutdown also hit factories across the car-making supply chain.

Slowing the UK economy

The production pause was a large contributor to a contraction in UK economic growth in September, official figures showed.

Had car output not fallen 28.6%, the UK economy would have grown by 0.1% during the month. Instead, it fell by 0.1%.

Read more from Sky News:
Telegraph future in limbo again as RedBird abandons £500m deal

Reacting to JLR’s impact on the GDP contraction, its chief financial officer, Richard Molyneux, said it was “interesting to hear” and it “goes to reinforce” that JLR is really important in the UK economy.

The company, he said, is the “biggest exporter of goods in the entire country” and the effect on GDP “is a reflection of the success JLR has had in past years”.

Recovery

The company said operations were “pretty much back running as normal” and plants were “at or approaching capacity”.

Production of all luxury vehicles resumed.

Investigations are underway into the attack, with law enforcement in “many jurisdictions” involved, the company said.

When asked about the cause of the hack and the hackers, JLR said it was not in a position to answer questions due to the live investigation.

A run of attacks

The manufacturer was just one of a number of major companies to be seriously impacted by cyber criminals in recent months.

High street retailer Marks and Spencer estimated the cost of its IT outage was roughly £136m. The sum only covers the cost of immediate incident systems response and recovery, as well as specialist legal and professional services support.

The Co-Op and Harrods also suffered service disruption caused by cyber attacks.

Four people were arrested by police investigating the incidents.

Sir Keir Starmer and Rachel Reeves have scrapped plans to break their manifesto pledge and raise income tax rates in a massive U-turn less than two weeks from the budget.

The decision, first reported in the Financial Times, comes after a bruising few days which has brought about a change of heart in Downing Street.

Read more: How No 10 plunged itself into crisis

I understand Downing Street has backed down amid fears about the backlash from disgruntled MPs and voters.

The Treasury and Number 10 declined to comment.

The decision is a massive about-turn. In a news conference last week, the chancellor appeared to pave the way for manifesto-breaking tax rises in the budget on 26 November.

She spoke of difficult choices and insisted she could neither increase borrowing nor cut spending in order to stabilise the economy, telling the public “everyone has to play their part”.

The decision to backtrack was communicated to the Office for Budget Responsibility on Wednesday in a submission of “major measures”, according to the Financial Times.

The chancellor will now have to fill an estimated £30bn black hole with a series of narrower tax-raising measures and is also expected to freeze income tax thresholds for another two years beyond 2028, which should raise about £8bn.

Tory shadow business secretary Andrew Griffith said: “We’ve had the longest ever run-up to a budget, damaging the economy with uncertainty, and yet – with just days to go – it is clear there is chaos in No 10 and No 11.”

How did we get here?

For weeks, the government has been working up options to break the manifesto pledge not to raise income tax, national insurance or VAT on working people.

I was told only this week the option being worked up was to do a combination of tax rises and action on the two-child benefit cap in order for the prime minister to be able to argue that in breaking his manifesto pledges, he is trying his hardest to protect the poorest in society and those “working people” he has spoken of so endlessly.

But days ago, officials and ministers were working on a proposal to lift the basic rate of income tax – perhaps by 2p – and then simultaneously cut national insurance contributions for those on the basic rate of income tax (those who earn up to £50,000 a year).

That way the chancellor can raise several billion in tax from those with the “broadest shoulders” – higher-rate taxpayers and pensioners or landlords, while also trying to protect “working people” earning salaries under £50,000 a year.

The chancellor was also going to take action on the two-child benefit cap in response to growing demand from the party to take action on child poverty. It is unclear whether those plans will now be shelved given the U-turn on income tax.

A rough week for the PM

The change of plan comes after the prime minister found himself engulfed in a leadership crisis after his allies warned rivals that he would fight any attempted post-budget coup.

It triggered a briefing war between Wes Streeting and anonymous Starmer allies attacking the health secretary as the chief traitor.

Read more: Is Starmer ‘in office but not in power’?

The prime minister has since apologised to Mr Streeting, who I am told does not want to press for sackings in No 10 in the wake of the briefings against him.

But the saga has further damaged Sir Keir and increased concerns among MPs about his suitability to lead Labour into the next general election.

Insiders clearly concluded that the ill mood in the party, coupled with the recent hits to the PM’s political capital, makes manifesto-breaking tax rises simply too risky right now.

But it also adds to a sense of chaos, given the chancellor publicly pitch-rolled tax rises in last week’s news conference.

The number of domestic UK flights has more than halved over the past 20 years, even as global air travel continues to grow.

This month, another UK regional airline, Eastern Airways, officially went into administration as our appetite for flying internally continues its steady descent.

A total of 213,025 UK flights were scheduled in 2025, compared to a peak in 2006 of 454,375 flights, research by aviation analytics firm Cirium, has found.

In other words, a fall of more than 240,000 flights, or an average daily reduction of 661 flights across the UK.

Perhaps surprisingly, cost isn’t a major factor in customers choosing to ditch flying for the car, coach or train, as fares have stayed roughly flat.

A pre-booked London to Edinburgh flight 20 years ago cost on average between £50 and £100 (once adjusted for inflation) compared with fares of around £40 – £70 today.

So what’s driving the trend?

A combination of better and more frequent train services, higher Air Passenger Duty tax, concern about the environmental impact of flying, and changing work patterns – especially since the pandemic – have all played a part.

Jeremy Bowen, Cirium CEO, said the results showed a “staggering change in the way we travel throughout the UK”.

“Airlines have responded by reducing their internal services and prioritising more popular destinations including Spain, France, and Italy,” he added.

Twenty years ago, Britain’s skies were busy with short domestic hops – British Airways (BA) and British Midland (bmi) shuttled passengers between London and the regions, and Flybe’s purple planes connected cities like Exeter, Leeds, Norwich, and Southampton.

Counting the cost

The impact of changing demand has been brutal.

Flybe, once Europe’s largest regional airline, has collapsed twice; bmi and its low-cost arm, bmibaby, is long gone; and several UK hubs have closed their commercial operations over the past 20 years, including Doncaster Sheffield in 2022, Blackpool in 2014 and Plymouth in 2011.

Also, airlines have shifted their priorities to making greater profits from short-haul services beyond the UK.

Aviation consultant Gavin Eccles said key low-cost carriers, such as easyJet and Ryanair, “have been ordering larger aircraft which means they can fly longer sectors”.

“They need to serve routes that are predominantly with strong ancillary options [baggage, seating] and domestic is more about commuting, so fewer chances to make extra revenues,” he explained.

Read more from Sky News:
Epstein called Trump ‘dangerous’
How AI-generated music is fooling us

Indeed, many surviving airports – like Southampton, Norwich, and Exeter – now rely mainly on seasonal leisure flights.

Domestic flights tend to be limited to feeder flights to long-distance hubs like Heathrow, Amsterdam, and Dublin, plus so-called lifeline-style services to remote regions, mostly in Scotland and Northern Ireland.

Rail firms are benefitting, with passenger journeys rising from about 1.08 billion in 2005/06 to 1.73 billion in 2024/25 – an increase of around 60%, according to the Office of Rail and Road Data.