Engineering giant Rolls-Royce has confirmed plans to shed thousands of jobs across its global workforce due to a downturn in the aviation industry caused by the coronavirus crisis.
There had been speculation that the firm was set to cut 8,000 jobs – but in a statement released this morning Rolls-Royce announced that it was looking to shed 9,000 positions from its global workforce of 52,000.
The company has also confirmed that the cuts will predominantly affect its civil aerospace business, which has its UK base in Derby.
Rolls-Royce is Derby’s largest private sector employer with around 12,000 staff. As well as being home to its civil aerospace business in Sinfin, Rolls-Royce’s Defence site is in Raynesway. The firm said that it will not be looking to reduce headcount in Defence.
Rolls-Royce said as well as cutting jobs it would also explore opportunities to move people into its Defence business.
Because it needs to consult first with employee and trade union representatives, the firm is not revealing how many jobs will go at specific sites.
As well as shedding jobs, Rolls-Royce said it will cut spending across plant and property, capital and other indirect cost areas, in order to save more cash.
Overall, the reorganisation of the business is expected to generate annual savings of more than £1.3 billion.
In a statement, Rolls-Royce said that the impact of the coronavirus pandemic on the aviation industry had been “unprecedented”.
It added that it believed it would take “several years” for the civil aerospace market to return to levels seen before the pandemic struck.
Chief executive Warren East 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.
“Governments across the world are doing what they can to assist businesses in the short-term, but we must respond to market conditions for the medium-term until the world of aviation is flying again at scale, and governments cannot replace sustainable customer demand that is simply not there.
“We have to do this right, which means we will work closely with our employee and trade union representatives as appropriate, look at any viable alternatives to mitigate the impact, consult with everyone affected and treat our people with dignity and respect.”
Two years ago, Rolls-Royce announced plans to cut thousands of jobs at Derby, which focused on middle management and back office roles.
Rolls-Royce said that programme of job cuts would transition into this latest plan to reduce headcount.
Mr East said: “The strategic choices that we have made over the last few years have helped us to respond rapidly to Covid-19 and the synergies between our divisions leave us well placed to capitalise on the long-term potential of our markets.
“The world on the other side of this pandemic will need the power that we generate to fuel economic recovery.
“I absolutely believe the call for that power to be more sustainable will be stronger than ever. This plays to our strengths.
“We must ensure that we are able to continue to innovate and play our leading role in enabling the vital sectors in which we operate to achieve net zero carbon emissions.
“We have emerged from troubled times before, to achieve incredible things. We will do so again.”