Rolls Royce ‘is to cut up to 8,000 jobs’ as coronavirus crisis hits income from air industry in impact that ‘could be worse than 9/11’
- Aero-engine maker Rolls-Royce Holdings could cut up to 15% of its workforce
- A source told Reuters it is not finalised and there is still negotiation to be done
- In April it was said Rolls-Royce would be looking at cutting cash expenditure
- It comes as customers cut production and airlines park planes amid pandemic
- Here’s how to help people impacted by Covid-19
British aero-engine maker Rolls-Royce Holdings is considering cutting up to 15 per cent of its workforce, a source close to the company told Reuters.
It comes as customers cut production and airlines park planes amid the coronavirus pandemic, with the company being paid by airlines based on how many hours its engines fly.
The size of layoffs has been mentioned internally by senior management, but is by no means finalised and there is a lot of negotiation still to be done, the source added.
The company’s engines power the Airbus A330, A340, A350, and A380, as well as the Boeing 777 and 787 Dreamliner.
Rolls-Royce Holdings is considering cutting up to 15 per cent of its workforce, a source close to the company told Reuters (file photo of a Rolls-Royce Holdings aircraft engine)
The Financial Times earlier reported Rolls-Royce was preparing to lay off up to 8,000 of its 52,000-strong workforce.
An announcement on the final figure is not expected before the end of May, when the company will update employees, according to a report from the FT.
Last month, Rolls-Royce scrapped its targets and final dividend to shore up its finances to cope with the virus outbreak.
The company’s Chief Executive Officer Warren East said in April Rolls-Royce would be looking at cutting cash expenditure, including salary costs across its global workforce by at least 10% this year.
Discussions with unions about the job cuts have just begun, the newspaper reported, citing sources.
The scale of job cuts is still likely to be larger than after 9/11 when the group cut 5,000 jobs and the vast majority of it is expected to hit the civil aerospace unit, the FT said.
The company’s engines power the Airbus A330 (file photo, pictured), A340, A350, and A380, as well as the Boeing 777 and 787 Dreamliner
While job losses are also expected in the unit’s operations in Singapore and Germany, Britain’s civil aerospace workforce is expected to bear the majority of the cuts, according to the report.
It follows Rolls-Royce being set to become the first UK car firm to restart full production after the coronavirus lockdown, with staff returning next Monday – a day earlier than Aston Martin.
Bosses previously said that 1,000 employees – half the total workforce – would be back on the production line from that date resuming production of its exclusive Phantom, Wraith, Dawn and Cullinan models.
Support staff such as marketing and sales will continue to work from home, it was earlier confirmed.
MailOnline has contacted Rolls Royce for comment.