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S&P Report Links Cyber Attacks And Auto Credit Quality
A new S&P Global Ratings report warns that cyber risk is now an immediate threat to automakers’ credit ratings worldwide. The study, “Auto Sector: When Cyber Risk Becomes Credit Risk,” finds that cyber incidents can quickly disrupt factory operations and hurt company finances. The main points are: operational shutdowns from cyber incidents can sharply reduce profit margins, these shutdowns can also cut cash flow, and lower profit and cash flow can reduce a company’s rating headroom, making global carmakers less creditworthy.
S&P’s scenario analysis looks at a one-month global production stoppage during a busy month like November. The report finds that this kind of shutdown could reduce output by 8% to 10% for European manufacturers. The report estimates that S&P Global Ratings-adjusted EBITDA margins would drop by 1.0 to 2.5 percentage points. The free operating cash flow-to-sales ratio would fall by at least 150 basis points.
For cyber insurers and brokers, this changing risk environment marks an important shift. Cyber risk, think JLR cyber incident, in the auto sector now directly affects credit risk and how capital markets view companies, showing how closely operational stability and financial health are linked.
OEMs Sit At The Center Of A Growing Attack Surface
The report highlights rising digital exposure across vehicles, plants, logistics, and finance divisions. Since 2021, data breaches have been the most common cyber incidents among rated auto companies, mainly because of the large amounts of customer and financial data in their finance units. In 2024, 60% of cybersecurity incidents hit millions of “mobility assets,” including vehicles and charging infrastructure. Large-scale events affecting millions of vehicles more than tripled, rising to 19% of incidents from 5% in 2023.
Original equipment manufacturers are now at the center of a fast-growing cyber risk. Their size and connected systems create a bigger target for attacks. Global supply chains, complex IT systems, and financial operations open up many ways for attackers to get in. Recent high-profile incidents at Jaguar Land Rover (JLR), Kojima Industries, and Nagoya Port highlight the serious risk.
Regional Vulnerability And Disclosure Rules Complicate The Picture
S&P uses RiskRecon data to compare cyber hygiene in different regions. European and Asia-Pacific auto companies have the lowest scores, averaging 6.8 on RiskRecon’s vulnerability scale. The report notes, “Companies with the weakest cybersecurity hygiene…have experienced breach events at rates 16.6 times higher” than the top-scored peers.
RiskRecon assigns grades from A to F based on exposed assets and system configuration. Just over 20.1% of F-scored organizations and 12.7% of D-scored groups reported at least one material breach. Only 1.2% of A-scored and 3.0% of B-scored companies reported similar events.
Disclosure rules differ by market, making cyber risk management more urgent and complex. In the U.S., public companies must report material cyber incidents within 4 business days of deciding they are significant, which is a tight deadline. In the U.K. and EU, companies must report personal data breaches to regulators within 72 hours of finding them. Not following these rules can lead to large fines and legal penalties, adding more financial pressure after an incident.
Scenario: One-Month Shutdown
S&P’s scenario analysis uses the recent JLR cyber incident as an example. A system attack that started on August 31, 2025, forced JLR to stop production through September and into early October. The shutdown caused sales volumes to drop and led to a quick downgrade of revenue and cash flow expectations.
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The report predicts that similar disruptive events could hit other European automakers. A one-month stoppage would quickly cut wholesale volumes, revenue, and earnings. Smaller companies like JLR would feel the biggest and fastest impact because they have less revenue to start with. S&P lowered JLR’s expected adjusted EBITDA margins to 3%-5%, down from 6%-7% before the attack. The report also says that the hit to free cash flow could be just as severe. For manufacturers already expecting negative free cash flow in 2025, their rating headroom could shrink quickly. Stellantis, Volvo, and JLR are at immediate risk, according to S&P.
Case Studies Illustrate Divergent Cyber Outcomes
The JLR cyber incident or episode had the clearest impact on ratings. S&P revised the outlook to negative in October 2025, citing the cyberattack and weaker metrics. The agency also cut its management and governance score to “moderately negative.” It highlighted “JLR’s lack of cyber preparedness and the significant effect of the attack on operations.”
JLR reported cyber-related costs of £196 million as of September 30, 2025. The U.K. government said the attack weighed on third-quarter GDP growth.
Other automakers faced smaller shocks.
- A 2022 malware attack at supplier Kojima Industries halted Toyota’s production in Japan for one day. About 13,000 vehicles were affected, an immaterial share of Toyota’s 2022 sales.
- A 2023 ransomware attack at Nagoya Port disrupted logistics, but Toyota’s diversified network absorbed the impact.
“Importantly, neither of the two cyberattacks affected Toyota’s cash flows or our rating on the company,” S&P states.
Continental’s 2022 data breach did not cause major direct losses, but it led to a less favorable view of management and governance. Nissan reported several incidents between 2023 and 2024, including ransomware and data exposure that affected employees. The financial impact was small, so there was no immediate rating change, but these events highlight the ongoing cyber risk.
How Cyber Risk Translates Into Ratings Pressure
S&P lists several rating factors affected by cyber incidents. Financial risk profiles get weaker when shutdowns reduce volumes and costs to fix problems go up. Companies might use credit lines or take on new debt, which lowers their rating buffers.
JLR’s cyber incident showed businesses’ risk profiles also take a hit when cyber events hurt brand trust, especially after data is stolen. Delays in recovery can lower profits for several quarters.
Liquidity can quickly become tight because of lost sales, higher security spending, and unstable working capital. Management and governance scores can drop sharply if cyber preparedness is poor or if disclosure is weak. S&P points out that both the JLR and Continental incidents led to urgent and severe governance downgrades.
The final impact on ratings depends on factors such as rating headroom, the severity and duration of the event, where it occurs, the costs involved, and insurance coverage. Reputational damage is harder to measure but is still a key part of S&P’s view of cyber risk.
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Cyber Insurance Emerges As Strategic Risk Tool
S&P points out a big protection gap. Cyber insurance still covers less than 1% of the global property and casualty market, even though cyber risk is one of the top business threats worldwide. Data shows that companies with insurance manage cyber risk better. Allianz reported that cyber losses for large insured firms dropped by more than 50% in early 2025, and the number of large losses fell by about 30% during the same time.
Modern cyber insurance policies now often include risk engineering and incident response. Insurers connect clients with cybersecurity experts, forensics teams, and crisis managers. These services help companies become more resilient and can lower the chances and impact of attacks.
Pricing and coverage limits will get stricter as underwriters become more selective about risk. Companies with better cyber hygiene and governance may get higher coverage limits. For automakers and suppliers, cyber insurance is now as important as capital planning and credit strategy.
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