If a war machine fails a Panic test (due to friends being destroyed within 6", Terror and so on) it does not flee, but it cannot shoot in their next Shooting phase. However, this does not prevent the crew clearing various misfire results.
Source: Warhammer Armies Project
If a war machine fails a Panic test (due to friends being destroyed within 6", Terror and so on) it does not flee, but it cannot shoot in their next Shooting phase. However, this does not prevent the crew clearing various misfire results.