Business
Rolls-Royce Proposes Major Reorganisation
Rolls-Royce Proposes Major Reorganisation.
About this update from Rolls-royce Holdings Plc
[{"type":"text","content":"\n \n \n RNS Number : 4045N\n Rolls-Royce Holdings plc\n 20 May 2020\n \n \n \n \n 20 May 2020\n \n \n \n ROLLS-ROYCE PROPOSES MAJOR REORGANISATION\n \n \n TO ADDRESS MEDIUM-TERM IMPACT OF COVID-19\n \n \n \n \n \n The impact of COVID-19 on Rolls-Royce and the whole of the aviation industry is unprecedented. We have already taken action to strengthen the financial resilience of our business and reduce our cash expenditure in 2020. It is, however, increasingly clear that activity in the commercial aerospace market will take several years to return to the levels seen just a few months ago. We must now address these medium-term structural changes, as demand from customers reduces significantly for our civil aerospace engines and aftermarket services. \n \n \n \n \n \n Warren East, Rolls-Royce, CEO 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.\"\n \n \n \n \n \n We are proposing a major reorganisation of our business to adapt to the new level of demand we are seeing from customers. As a result, we expect the loss of at least 9,000 roles from our global workforce of 52,000. In addition to the savings generated from this headcount reduction, we will also cut expenditure across plant and property, capital and other indirect cost areas. The proposed reorganisation is expected to generate annualised savings of more than £1.3bn, of which we expect headcount to contribute around £700m. ...