Rolls to shed 2,000 jobs and trim supplier base

ROLLS-ROYCE, the aero-engine maker, is to shed a further 2,000 jobs this year and streamline its supply base as part of an efficiency programme expected to boost profits by pounds 70m.

The job cuts follow 2,000 redundancies last year and will take the workforce down to about 38,300. The number of suppliers is likely to decline from 500 to around 300.

News of renewed cost drive came as Rolls disclosed that it had contacted competition authorities in Brussels and Washington over a joint venture between its two US rivals to develop a new engine for the proposed Airbus super-jumbo.

Sir Ralph Robins, chairman, said Rolls had "put down a marker" with the Federal Trade Commission and the European Commission, expressing concern that the alliance between General Electric and Pratt & Whitney was not widened to other engine programmes. "We want to make sure they are not allowed to employ uncompetitive practices when they are bidding against us," he added.

GE and P&W are jointly developing an engine for the A3XX, the proposed Airbus 500-seat double-deck jet. It will compete with the Trent 900 engine Rolls has offered to develop.

Sir Ralph said Rolls took it as a compliment that its US rivals should need to combine forces to compete with Rolls. But Rolls itself will also require a significant number of risk and revenue-sharing partners to fund the development of the engine.

A quarter of the current Trent programme is funded by overseas partners. Last year the Trent tightened its stranglehold in the "big twin" market, winning two-thirds of all engine orders for the Boeing 777 and Airbus A330. Overall, Rolls has 40 per cent of engine orders on the two aircraft.

The Trent's success helped Rolls increase its order book by 30 per cent to pounds 10.4bn last year and boosted pre-tax profits by 18 per cent to a record pounds 325m.

Sir Ralph said that although order intake this year would not be as high as 1998, when the order book grew by pounds 8bn, it would still grow strongly despite the Asian downturn. Sales of civil and military engines, including those supplied by its US business Allison and the Rolls/BMW joint venture, will reach about 1,200 this year against 1,065 last year.

The group-wide efficiency programme, known as Better Performance Faster, contributed pounds 30m to the bottom line last year. A total of 5,000 engineers have been put through courses.

Profits from the civil and military aerospace business rose from pounds 253m to pounds 370m, while Rolls's industrial turbine division grew profits by pounds 4m to pounds 35m.

Spares accounted for one-third of aerospace sales but are thought to contribute about two-thirds of profits. Sir Ralph said margins had held up well.

Sir Ralph played down remarks he reportedly made last year warning that Rolls might switch production abroad if the Government burdened industry with further social costs, saying he did not see this as a problem. Indeed, most manufacturing work in the BMW venture is carried out in the UK because it is more competitive, he said.

PROMOTED VIDEO
Arts and Entertainment
musicBand's first new record for 20 years has some tough acts to follow
News
peopleAt least it's for a worthwhile cause
Voices
A new app has been launched that enables people to have a cuddle from a stranger
voicesMaybe the new app will make it more normal to reach out to strangers
News
Liam Payne has attacked the media for reporting his tweet of support to Willie Robertson and the subsequent backlash from fans
peopleBut One Direction star insists he is not homophobic
Life and Style
healthFor Pure-O OCD sufferers this is a reality they live in
Life and Style
Sexual health charities have campaigned for the kits to be regulated
healthAmerican woman who did tells parents there is 'nothing to be afraid of'
News
ebooksAn unforgettable anthology of contemporary reportage
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

Trainee / Experienced Recruitment Consultants

£20000 - £25000 per annum + OTE £40,000: SThree: SThree are a global FTSE 250 ...

Trainee Recruitment Consultant - Soho

£20000 - £25000 per annum + OTE £40000: SThree: As a Recruitment Consultant, y...

Trainee Recruitment Consultants - Banking & Finance

£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

Quantitative Risk Manager

Up to £80000: Saxton Leigh: My client, a large commodities broker, is looking ...

Day In a Page

A roller-coaster tale from the 'voice of a generation'

Not That Kind of Girl:

A roller-coaster tale from 'voice of a generation' Lena Dunham
London is not bedlam or a cradle of vice. In fact it, as much as anywhere, deserves independence

London is not bedlam or a cradle of vice

In fact it, as much as anywhere, deserves independence
Vivienne Westwood 'didn’t want' relationship with Malcolm McLaren

Vivienne Westwood 'didn’t want' relationship with McLaren

Designer 'felt pressured' into going out with Sex Pistols manager
Jourdan Dunn: Model mother

Model mother

Jordan Dunn became one of the best-paid models in the world
Apple still coolest brand – despite U2 PR disaster

Apple still the coolest brand

Despite PR disaster of free U2 album
Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments