BAe shake-up threatens 700 jobs: Rationalisation at home as joint venture with Taiwan remains in balance

THOUSANDS of British Aerospace jobs were on the line last night as the company announced a large-scale rationalisation of its turboprop division in Scotland and battled to salvage its pounds 300m joint venture with Taiwan to manufacture regional jets.

Unions meeting BAe at the company's headquarters in London last night were braced for up to 700 job losses among the 3,500-strong workforce employed in its Jetstream and Advanced Turboprop aircraft business at Prestwick, Ayrshire.

Meanwhile, Taiwan's economics minister, Chiang Pin-kung, appeared to hammer another nail into BAe's proposed tie-up with the Taiwanese Aerospace Corporation to produce a new range of regional jets by telling parliament that the deal was 'not proceeding'.

If the deal collapses it will put 3,000 jobs at risk at BAe's regional aircraft factories in Woodford and Chadderton, near Manchester, and punch a large hole in the pounds 1bn restructuring of its loss-making commercial aircraft activities announced by John Cahill, chairman, last year.

BAe said later, however, that it was still hopeful that the joint venture would go ahead, adding that the minister's statement had changed nothing.

'Speaking to various people in Taiwan we don't feel anything has changed,' a BAe spokesman said. 'There is nothing new in this (government) statement.

'I think you will recognise that the minister was speaking in response to a question from the opposition . . . We don't believe anything has changed and the Taiwan government still wants the joint venture.'

The fate of the joint venture company, set up in January to manufacture the BAe 146 and successor aircraft in both Britain and Taiwan, now appears to hinge on whether the TAC board votes to abandon the project or continue negotiations when it meets next Tuesday.

But BAe said it still believed it had more than a few days to rescue the deal, which has foundered on a dispute over the amount of technology that should be exported from Britain to Taiwan. Mr Cahill is preparing to fly to Taiwan in the near future to resume negotiations, although no firm date has yet been fixed.

Last month BAe's chief executive, Dick Evans, warned that the Jetstream business was 'not sustainable' at its current level of losses. It lost pounds 60m in the first half of the year.

BAe is speaking to a number of other turboprop manufacturers in Europe, including Saab of Sweden and the French-Italian consortium ATR, with a view to securing a tie- up and cutting overcapacity.

PROMOTED VIDEO
News
ebooksAn unforgettable anthology of contemporary reportage
Money
Welcome to tinsel town: retailers such as Selfridges will be Santa's little helpers this Christmas, working hard to persuade shoppers to stock up on gifts
news
News
i100
News
people
Arts and Entertainment
Architect Frank Gehry is regarded by many as the most important architect of the modern era
arts + entsGehry has declared that 98 per cent of modern architecture is "s**t"
Arts and Entertainment
Soul singer Sam Smith cleared up at the Mobo awards this week
arts + entsSam Smith’s Mobo triumph is just the latest example of a trend
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Compensation and Benefits Manager - Brentwood - Circa £60,000

£60000 per annum: Ashdown Group: Compensation and Benefits Manager - Compensat...

Data Analyst/Planning and Performance – Surrey – Up to £35k

£30000 - £35000 Per Annum plus excellent benefits: Clearwater People Solutions...

IT Systems Business Analyst - Watford - £28k + bonus + benefits

£24000 - £28000 per annum + bonus & benefits: Ashdown Group: IT Business Syste...

Markit EDM (CADIS) Developer

£50000 - £90000 per annum + benefits: Ampersand Consulting LLP: Markit EDM (CA...

Day In a Page

Wilko Johnson, now the bad news: musician splits with manager after police investigate assault claims

Wilko Johnson, now the bad news

Former Dr Feelgood splits with manager after police investigate assault claims
Mark Udall: The Democrat Senator with a fight on his hands ahead of the US midterm elections

Mark Udall: The Democrat Senator with a fight on his hands

The Senator for Colorado is for gay rights, for abortion rights – and in the Republicans’ sights as they threaten to take control of the Senate next month
New discoveries show more contact between far-flung prehistoric humans than had been thought

New discoveries show more contact between far-flung prehistoric humans than had been thought

Evidence found of contact between Easter Islanders and South America
Cerys Matthews reveals how her uncle taped 150 interviews for a biography of Dylan Thomas

Cerys Matthews on Dylan Thomas

The singer reveals how her uncle taped 150 interviews for a biography of the famous Welsh poet
DIY is not fun and we've finally realised this as a nation

Homebase closures: 'DIY is not fun'

Homebase has announced the closure of one in four of its stores. Nick Harding, who never did know his awl from his elbow, is glad to see the back of DIY
The Battle of the Five Armies: Air New Zealand releases new Hobbit-inspired in-flight video

Air New Zealand's wizard in-flight video

The airline has released a new Hobbit-inspired clip dubbed "The most epic safety video ever made"
Pumpkin spice is the flavour of the month - but can you stomach the sweetness?

Pumpkin spice is the flavour of the month

The combination of cinnamon, clove, nutmeg (and no actual pumpkin), now flavours everything from lattes to cream cheese in the US
11 best sonic skincare brushes

11 best sonic skincare brushes

Forget the flannel - take skincare to the next level by using your favourite cleanser with a sonic facial brush
Paul Scholes column: I'm not worried about Manchester United's defence - Chelsea test can be the making of Phil Jones and Marcos Rojo

Paul Scholes column

I'm not worried about Manchester United's defence - Chelsea test can be the making of Jones and Rojo
Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

While other sports are stalked by corruption, we are an easy target for the critics
Jamie Roberts exclusive interview: 'I'm a man of my word – I'll stay in Paris'

Jamie Roberts: 'I'm a man of my word – I'll stay in Paris'

Wales centre says he’s not coming home but is looking to establish himself at Racing Métro
How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?

A crime that reveals London's dark heart

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?
Meet 'Porridge' and 'Vampire': Chinese state TV is offering advice for citizens picking a Western moniker

Lost in translation: Western monikers

Chinese state TV is offering advice for citizens picking a Western moniker. Simon Usborne, who met a 'Porridge' and a 'Vampire' while in China, can see the problem
Handy hacks that make life easier: New book reveals how to rid your inbox of spam, protect your passwords and amplify your iPhone

Handy hacks that make life easier

New book reveals how to rid your email inbox of spam, protect your passwords and amplify your iPhone with a loo-roll
KidZania lets children try their hands at being a firefighter, doctor or factory worker for the day

KidZania: It's a small world

The new 'educational entertainment experience' in London's Shepherd's Bush will allow children to try out the jobs that are usually undertaken by adults, including firefighter, doctor or factory worker