Britain’s economy saw only minimal growth in the third quarter, held back by a major cyberattack on Jaguar Land Rover in September. The latest data highlights a sluggish economic backdrop as finance minister Rachel Reeves prepares her upcoming budget.
The Office for National Statistics (ONS) said the economy grew by just 0.1% in the third quarter of 2025. This marked a slowdown from the 0.3% growth recorded in the second quarter.
Economists surveyed by Reuters, as well as the Bank of England, had expected GDP to rise by 0.2% in the July–September period.
The economy contracted by 0.1% in September alone, compared with forecasts for no change.
The latest figures are unlikely to influence Reeves’ November 26 budget, with overall growth still weak despite government efforts to “kickstart” economic momentum.
Sluggish Growth Concerns
Suren Thiru, economics director at the ICAEW, said the UK’s slow growth trend creates difficulties for the Chancellor. He noted that weak expansion increases the likelihood of a fiscal shortfall in the budget, making major tax rises harder to avoid.
The ONS reported a steep 28.6% drop in motor vehicle production in September—the largest decline since April 2020 at the start of the pandemic.
The motor vehicle sector reduced GDP by 0.17 percentage points in September and by 0.06 percentage points across the whole quarter.
The ONS referenced a report from the SMMT trade body stating that a “cyber incident paused production at a major manufacturer.”
Jaguar Land Rover, owned by Tata Motors, operates three factories in the UK, producing around 1,000 vehicles per day.
An independent cybersecurity group estimated the hack cost the UK economy £1.9 billion ($2.55 billion) and impacted more than 5,000 organisations.
A drop in commercial vehicle production in September added further strain to the sector.
The Bank of England expects economic growth to improve in the fourth quarter, forecasting a 0.3% expansion.
Responding to the new data, Rachel Reeves pointed out that Britain had the fastest-growing economy in the G7 during the first half of 2025, but acknowledged there was still significant progress needed.
