Engine manufacturer, Rolls-Royce has said it will cut at least 9,000 roles from its global workforce of 52,000 in a bid to reduce its cash expenditure amid a drop in demand for its civil aerospace engines and services caused by the COVID-19 pandemic.
The Derby-based firm said the impact of the virus on its business was “unprecedented” and that the commercial aerospace market “will take several years to return to the levels seen just a few months ago.”
The majority of the job losses are expected to be in the UK.
Warren East, Rolls-Royce CEO, said: “This is not a crisis of our making. But it is the crisis that we face and we must deal with it. Our airline customers and airframe partners are having to adapt and so must we. Being told that there is no longer a job for you is a terrible prospect and it is especially hard when all of us take so much pride in working for Rolls-Royce. But we must take difficult decisions to see our business through these unprecedented times.”
The proposed reorganisation – which includes spending cuts across plant and property, capital, and other indirect cost areas – is expected to generate annual savings of more than £1.3bn, of which the headcount reduction will contribute around £700m.
The company said the job cuts will predominantly affect its civil aerospace business. Its defence division, based in the UK and US, “has been robust during the pandemic” and does not require a reduction in its workforce. The firm said it is “exploring opportunities” to move people between the civil and defence divisions.