Rolls-Royce timing questioned as it cuts 4,600 jobs to save £400m a year
The latest restructuring comes in the midst of a crisis over the quality of parts in the Trent 1000 Boeing engine
London — Britain’s Rolls-Royce said it would cut 4,600 jobs to save £400m a year in the latest attempt by CEO Warren East to simplify the business and generate more cash. East has been overhauling Rolls during his three years in charge of the engine maker but the job cuts announced on Thursday come at a tricky time for a company, which has been hit by problems with some aero-engines that have angered clients. Parts in some versions of the Trent 1000 engine, which powers the Boeing 787 Dreamliner jet, are not lasting as long as expected, forcing the company to ground planes to carry out inspections. East said the job cuts were needed to help the company achieve profitable growth. They will enable it to save £400m a year by the end of 2020, but will cost £500m over 2018, 2019 and 2020. It will be reported as separate one-off costs, allowing it to stick to its targets for free cash flow.
"These changes will help us deliver over the mid and longer term a level of free cash flow we...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.