Rolls-Royce has announced a raft of job cuts due to be phased over the next 18 months.
The company stated that it will be reducing its headcount by 2,600 with the majority of cuts coming in its aerospace division. Officials stated that most of the posts will be shed during 2015 but it is still unclear as to where in its global operations the cuts will be made. Rolls-Royce currently has a worldwide workforce of 55,000 with 24,000 being in the UK.
Rolls-Royce noted that the cuts are consistent with its decision, announced in October, to accelerate progress on the 4Cs: Customer, Concentration, Cost and Cash. The company stated that it was committed to further pursuing cost improvements across its operations including its Land & Sea division.
John Rishton, chief executive officer, said: “We are taking determined management action and accelerating our progress on cost. The measures announced today will not be the last, however they will contribute towards Rolls-Royce becoming a stronger and more profitable company."
The company stated that it will be working alongside its employees and their representatives to agree possible redundancies. Voluntary cuts will be offered while it continues to look at which members of staff need to be retained due to their level of skills and expertise.
When announcing its 4Cs focus, Rolls-Royce warned that sanctions imposed on Russia could affect its operations. The engineering firm saw shares fall by 11.5 per cent as the trade sanctions put in place by the European Union and the US contributed towards a fall in revenues.
The group stated that these changes had prompted it to revise its revenue for 2014, which is now 3.5 per cent to four per cent lower than previously expected. However, it maintained that underlying profit would remain flat thanks to cost savings counterbalancing the falling revenue.
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