Rolls forced overseas for engineers

Manufacturing engineers have been hired from eastern Europe, Germany, Spain, France and the US to help modernise the company's engine factories. John Cheffins, the chief operating officer, said that the best engineers came from Germany.

Rolls had to go to America to find a head of procurement. Its head of logistics is a British executive who spent much of his working life with Nissan in Japan.

Sir John Rose, Rolls' chief executive, blamed the shortfall in engineers on the "rhetoric" that Britain had turned into a post-industrial nation. "Manufacturing has become a smaller part of the economy, smaller perhaps than we would like, and that has had an impact on the skills base, leaving us with a smaller pond to fish in."

Rolls is also sourcing more of its £2.8bn supply chain from low-cost economies such as China, India, Mexico, the Czech Republic and Romania. Nearly 10 per cent of its requirements now come from such countries compared with nothing four years ago.

Sir John said that, over time, the proportion of its workforce employed outside the UK would exceed 50 per cent. At present, 40 per cent of the group's 35,000 workers are based outside the UK.

Sir John said the proportion of the company's £6.5bn turnover accounted for by lucrative spares sales would remain above 50 per cent for the foreseeable future. Last year, the after-market generated 54 per cent of sales and accounted for more turnover than the entire group achieved in 1991.