Rolls-Royce to cut another 600 jobs in face of challenging market conditions
Published 18/05/2015 | 14:51
Rolls-Royce is to cut another 600 jobs on top of existing plans to axe hundreds of jobs in the face of challenging market conditions.
The company, which has major bases in Bristol and Derby, said the new job losses will take place at its marine engine division by the end of the year.
It said half of the jobs will go at its Scandinavian operation where it works on ship design and propulsion equipment for the oil and gas industry.
In the UK the firm expects that fewer than 30 jobs will go in support and purchasing roles. It employs around 700 staff across a number of sites including Derby, Warwick, Bristol and the group's London head office.
The firm is halfway through a separate programme, announced last November, to cut 2,600 jobs over the next 18 months at its aerospace and land & sea divisions as customers opt to delay or cancel orders.
Rolls said around half of the job cuts at its marine unit will fall in Norway, where the majority of employees and manufacturing facilities are based. The rest of the cuts will come globally from a division that employs around 6,000 staff in 34 countries.
The firm has been affected by a slowdown in spending in the oil and gas sector that had seen the oil price cut by more than half since last summer.
Rolls-Royce marine president Mikael Makinen said: "We are transforming our marine business and while we are making good progress on cost, the effect of low oil prices means we have to continue to look for further efficiencies."
Rolls said the move will have a broadly neutral impact on profits this year, and will generate approximately £25 million of savings from 2016 onwards. It has not ruled out further cuts at its marine division.
In February Rolls-Royce reported its first fall in revenues for a decade as underlying sales for 2014 fell 6% to £14.6 billion, hit by defence spending cuts and falling commodity prices. Its underlying profits were 8% lower at £1.62 billion over the same period.
In the UK the firm employs 25,000 staff and a total of 55,000 worldwide.