Rolls-Royce to cut 400 more jobs

Rolls-Royce had already announced in May that it would cut 600 jobs in its marine unit, which employs 5,800 people and builds propulsion systems, winches and anchors for ships.

“Our order book and profitability have been adversely impacted by the sharp and subsequently prolonged drop in the price of oil”, Mikael Makinen, president of Rolls-Royce Marine, said in the statement.

Britain’s Rolls-Royce said it would cut an additional 400 staff from its marine business by the end of next year, in its latest move to make the unit more efficient and cope with a fall in orders as a result of the lower oil price.

London-based Rolls-Royce said the 30 million pound ($45 million) in restructuring costs associated with the layoffs were included in its July earnings update and will stretch into next year.

Company officials first publicly discussed the modernization plan at an IBJ aerospace and aviation breakfast April 21, though they would say little beyond that the project would cost hundreds of millions of dollars.

A few of the savings would be invested in research and development spending.

REUTERS/Danish SiddiquiRolls-Royce is bailing out its Marine division. Rolls-Royce warned earlier this year that more job cuts in its marine businesses were possible.

Gov. Mike Pence and Mayor Greg Ballard are scheduled to attend a press conference Monday morning where Rolls-Royce will announce a “significant investment” in its Indianapolis operations.

The engine maker last week also said it would shutter an engine overhaul joint venture with American Airlines due to a lack of work.

The marine unit counted for about 12 per cent of the Rolls-Royce group’s revenue in 2014. It anticipated sales of GBP1.45 billion to GBP1.65 billion.