Rolls move saves East Kilbride jobs

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The Independent Online

Rolls-Royce yesterday told 1,100 workers in Scotland their jobs were safe, as the aero-engine maker unveiled plans for a new £45m factory north of the border.

Rolls decided against relocating its engine repair and overhaul operation to Eastern Europe, where wages are a fraction of those here, after the Government awarded the group an £8m grant to safeguard UK jobs.

Its factory in East Kilbride, Lanarkshire, which was built in 1953 to service RAF planes during the Korean War, will be shut down and sold. Rolls will build a new factory on another site within the town, which is due to open in April 2006.

A Rolls spokesman said: "Throughout the review process, competing options were examined in great detail. But the deciding factor not to relocate this business to another country was the highly skilled workforce in East Kilbride."

Rolls, which employs 2,600 people in Scotland, is also investing £85m to modernise and relocate its engine compressor blades and seals factory at Hillington, on the outskirts of Glasgow. Later this year, some 900 workers will clock in at Rolls' new seals operation at Inchinnan, also near Glasgow airport.

Rolls shares edged 1.75p lower to 228.5p yesterday but are still close to a 12-month high. Rolls is expected to have paid off its £550m of debt by the end of next year.