Rolls Royce Job Cuts on The Cards

Rolls-Royce is expected to announce thousands of job losses when it updates investors later this week on its programme to boost profitability and cash flow.

It is thought that on Friday the engineering firm will outline fresh plans to simplify processes, including back office and middle-management job cuts throughout the company. Analysts are of the view that 4,000 jobs could be lost. 

The firm is also expected to reaffirm its commitment to generate £1 billion in cash flow by 2020.

Image: Warren East, Chief Executive Officer of Rolls-Royce

Back in March, chief executive Warren East had announced plans to slim the company down from five divisions to three, creating three divisions – civil aerospace, defence and power. However, he did not disclose details pending a review at the time by change management specialists. 

East has admitted in the past that Rolls-Royce has never made a profit on the sale of its engines, instead relying on long-term maintenance contracts. Current restructuring plans are intended to bring down the costs of engine production and servicing by eliminating unnecessary bureaucracy.  

In 2015, East announced a plan to reduce the company’s 2,000 management roles by a quarter. However, some critics argue these positions have simply re-emerged in different guises. 

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