As manufacturing becomes more reliant on automation, IoT (Internet of Things), and cloud-based systems, it continues to be a prime target for cyberattacks. In fact, according to IBM’s X-Force Threat Intelligence Index¹, manufacturing was the most targeted industry for cyber threats in 2022, surpassing finance and insurance. With cybercriminals exploiting vulnerabilities in connected systems, safeguarding your operations is more critical than ever.

The Growing Threat of Cyberattacks in Manufacturing

Manufacturers, often relying on outdated systems, can be vulnerable to cyber threats. Some of the most common attacks include:

• Ransomware Attacks: Cybercriminals lock critical systems until a ransom is paid. According to Palo Alto Networks, the average ransomware payout reached $1.54 million in 2023².

• Phishing Scams: Social engineering tactics deceive employees into disclosing sensitive information.

• IP Theft & Espionage: Competitors, particularly foreign entities, steal proprietary designs and trade secrets.

• Supply Chain Vulnerabilities: Attackers exploit weaknesses in third-party vendors to infiltrate networks.

Why Cybersecurity Should Be a Priority

A cyberattack can lead to severe consequences, including production downtime, regulatory fines, and reputational damage. A report from Deloitte³ found that 43% of manufacturers experienced a cybersecurity incident that impacted operations. Additionally, the average cost of a data breach in manufacturing is estimated at $4.47 million per incident.

How to Strengthen Cybersecurity in Manufacturing

Here are essential steps manufacturers can take to protect their operations:

• Regularly Update Software & Systems: Outdated equipment is a hacker’s best friend—ensure firmware and software are current.

• Implement Multi-Factor Authentication (MFA): Adding extra security layers prevents unauthorized access.

• Train Employees on Cyber Hygiene: Phishing remains a top threat, so educating staff can help prevent breaches.

• Segment Your Network: Separate IT and OT (Operational Technology) systems to limit the spread of attacks.

• Backup Data Frequently: Offline or partner with a software vendor that offers “immutable” backups (these are backups that cannot be changed).

• Monitor & Respond: Use cybersecurity monitoring tools to detect threats early and have an incident response plan. 

Ryan Wessels, Director - Cyber Security at Acuity Insurance, recommends, “For smaller companies that cannot hire individual staff members to dedicate to monitoring, look for a trusted partner that can provide the 'eyes on glass' monitoring. These are traditionally called MSPs (managed security providers). They should also ensure that any MSP they partner with has experience in the OT/ICS space since that is a very different world. Also, practice the response plan, even if it’s just over a conference room table talking through a scenario.”

Real-World Example of Cyberattacks in Manufacturing

Even companies with strong cybersecurity measures can fall victim to ransomware. One such case involved a manufacturer of basic food products that suffered a devastating ransomware attack after a single employee visited a compromised site. Despite having cybersecurity training and a protected computer, the advanced nature of the attack allowed it to succeed. "Every business is a potential ransomware victim, whether specifically targeted or not. Opportunistic attacks often outnumber deliberate ones," says Wessels. "In this case, the attack crippled operations for nearly a week, impacting a global workforce. Fortunately, third-party experts and a well-trained team strengthened the company’s response, enabling a faster recovery."

Emerging Threats & AI in Cybersecurity

As cyber threats become more advanced, attackers leverage artificial intelligence (AI) to automate and enhance attacks. AI-powered malware can adapt and evade traditional security defenses, making detection more difficult. Additionally, deepfake phishing scams—in which AI generates fake voices or images—are being used to deceive employees into providing sensitive information.

To counteract these threats, manufacturers can integrate AI-driven cybersecurity solutions that use machine learning to detect unusual patterns in network activity. Automated threat detection systems can respond in real time, stopping attacks before they cause significant damage. Investing in AI-powered cybersecurity tools can help manufacturers stay ahead of cybercriminals.

Meeting Compliance and Regulatory Requirements

As cybersecurity threats rise, manufacturers face increasing regulations, particularly those handling sensitive data or government contracts. Adhering to established security frameworks enhances protection and minimizes legal and financial risks. Key guidelines include:

• NIST Cybersecurity Framework: Voluntary best practices for managing cyber risks.

• ISO 27001: A globally recognized standard for information security management.

• CMMC (Cybersecurity Maturity Model Certification): A mandatory requirement for U.S. Department of Defense contractors. Following these frameworks strengthens security, builds client trust, and ensures regulatory compliance.

The Role of Cyber Insurance in Manufacturing

Even with strong cybersecurity defenses, no system is entirely immune to attacks. Cyber insurance can help manufacturers mitigate the financial impact of cyber incidents by covering costs related to:

• Ransomware payments and data recovery

• Business interruption and lost revenue

• Legal fees and regulatory fines

• Customer notification and reputation management
   

Stay One Step Ahead

Evaluating cyber insurance options can provide an extra layer of financial protection in case of an attack. For more information, visit Acuity.com or talk to your independent insurance agent today. Investing in cybersecurity isn’t just about protecting data—it’s about ensuring the continuity and success of your business.

Sources:

¹https://www.ibm.com/reports/threat-intelligence

²https://www.paloaltonetworks.com/blog/2022/06/average-ransomware-payment-update/

³https://www2.deloitte.com/content/dam/Deloitte/us/Documents/manufacturing/us-manu-cyber-risk-in-advanced-manufacturing.pdf