Thousands of UK jobs could be axed as Rolls-Royce looks to make cuts to boost profits, it has been reported.
As many as 4,000 people could be out of a job if the aero-engine maker goes ahead with the reported ‘middle management’ cull, which could see the biggest impact in Derby.
Chief executive Warren East is expected to announce the company is slashing back-office staff and middle managers on Friday.
Since taking the helm of the company which holds Civil Aerospace and Nuclear divisions in Derby, Mr East has overseen 5,500 job cuts since 2015.
The Sunday Times reports Mr East will continue with his mission to cut what is seen as duplicated roles.
According to the paper 10 per cent of the 50,000-strong workforce could be cut.
Despite boasting customers in more than 150 countries, comprising more than 400 airlines and leasing customers, 160 armed forces, 4,000 marine customers including 70 navies, and more than 5,000 power and nuclear customers – East said in 2017 the company got ‘a little bit fat’.
Just two months ago Rolls Royce came back fighting as it announced it was working to profit after its worst ever performance, a £4.6 billion pre-tax loss for 2016.
Issues with the Trent 1000 and Trent 900 aero engines, where parts wore out sooner than expected, cost the company around £270m before it staged a fightback.
In 2018 it announced a pre-tax profit of £4.9 billion.
Just last week the company announced it had struck a new deal with Spain’s Astilleros Gondan shipyard for the design, propulsion and auxiliary machinery systems for the ‘world’s most advanced fishing vessel’ for delivery in 2020.
It also announced weeks ago the MT30 gas turbine has been chosen by military chiefs to power a new class of frigates for the Japan Maritime Self Defence Force (JMSDF).
However, cuts are expected to be far reaching.
In 2017 the company promised 7,000 jobs were safe, telling unions no compulsory redundancies would be made among its engineers for five years.
However, white collar managers roles were not under the same protection.
JP Morgan Cazenove analysts said: ‘We would not be surprised if Rolls-Royce announces a headcount reduction of about 10 per cent’.
Rolls-Royce reportedly brought in firm Alvarez & Marsal to help the company’s reorganisation through cuts, which will target back-office staff rather than its 18,000 engineers.
