To date, the announcement by global Aerospace, Defence and Power giant Rolls-Royce that they will be forced to axe around 9,000 personnel – about 17% of its global workforce – in the aftermath of the coronavirus outbreak has left Africa largely unscathed.
The cuts to its civil aerospace division came as the company offered a voluntary severance package to all sector employees in the UK. A spokesman for the company said the cuts would mainly affect staff in engine maintenance and servicing operations.
News first broke with the announcement of an expected 700 strong job losses at its Inchinnan factory near Glasgow airport in Scotland. This was met with widespread criticism and shock.
The job cuts at its Inchinnan plant, near Glasgow Airport, will mostly affect people who service aero-engines.
Rolls-Royce said it was considering withdrawing its services capability from the site permanently.
A spokeswoman said the company understood this is “a terrible and devastating prospect” for workers and communities affected.
Further cuts to its operations in Derby, and the East Midlands with other jobs in the Midlands in Solihull, Ansty and Trentham were also announced.
Indications are that the company is aiming to cut a total of 3,000 UK jobs – almost a fifth of its 50,000-strong workforce.
The aviation sector has been struggling across the globe due to a plummet in demand for air travel after the coronavirus locked down borders and grounded fleets.
If the voluntary redundancy scheme does not attract enough applications, the company will go into consultations with staff and unions about compulsory job losses.
All of this came shortly after the company announced it was undergoing massive reorganisation.
“This is an important step as we resize our business to adapt to the impact of the Covid-19 pandemic on the aviation industry. We will unfortunately lose people who have worked hard to establish our world-leading position”, said chief executive Warren East.
Rolls Royce civil aerospace business makes and services airliner engines and generates half of the company’s £15bn annual revenues. It will be hardest hit by the cuts.
But Rolls-Royce’s defence business will not need to reduce staff numbers, said the company.
“As part of the re-organisation, we will ensure that our internal civil aerospace supply chain continues to support our defence programmes,” it added.
Rolls-Royce said it will also “explore any opportunities” to move personnel to its defence division.
The company said the loss of the staff will contribute £700 million to a broad re-organisation which will save around £1.3 billion per year.
Rolls-Royce said it plans to cut expenditure across plants and property, capital and other indirect cost areas.
Cash costs relating to the restructuring will probably be around £800 million, the company said, incurred over 2020-22.
“This is not a crisis of our making,” said East.
“But it is the crisis that we face and we must deal with it. Our airline customers and airframe partners have adapted and so must we.”
He said that governments are trying to assist businesses, but they “cannot replace sustainable customer demand that is simply not there”.
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Rolls Royce In Africa
Rolls-Royce civil aerospace division has supported African aviation for almost 100 years. Today the company serves 20 operators, powering over 60 widebody aircraft, with more than 50 aircraft on order. Roll-Royce powered ‘flying hours’ in Africa has increased by over 50% over the last five years.
Rolls-Royce Power Systems business (includes MTU Solutions) provides innovative solutions ideally suited to meet Africa’s rapidly growing societal demands for energy and mobility.
The company provides a range of power generation solutions and capacities for any electrification requirement. From standby power generation sets for hospitals and data centres to rural hybrid micro-grid solutions and highly efficient power plants delivering electricity to towns and cities.
Rolls-Royce employs 120 people across Southern Africa, with offices in Cape Town, Johannesburg and a regional office in Zambia, as well as satellite offices strategically situated to serve customers.
Rolls-Royce’s Defence business is a market leader in aero-engines for military transport and patrol aircraft with strong positions in combat and helicopter applications.
Rolls-Royce has a significant scale in naval markets across the world and prides itself as the technical authority for the through-life support of nuclear power plants for submarines.
Rolls-Royce defence division has retained solid relationships with a number of African countries for many decades, serving many forces, namely Algeria, Tunisia and South Africa.