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At Rolls Royce
And JLR keeping access to Europe by moving manufacture out of Britain
Could be the beginning.
I don't know about JLR, but Rolls Royce (it's the Aircraft Engine people, not the Car People - I'd be amazed if they employ 4000 people in the UK) has been going through a really rough time due to a duff engine grounding aircraft for his customers.
If 'the beginning' you speak of is a financial collapse because of the 'B word' it's unlikely to hurt manufacturing as much as other industries, our currency is still 10% weaker than it was before the referendum and that makes stuff cheaper to make here.
22,000 In the UK from memory.
our currency is still 10% weaker than it was before the referendum and that makes stuff cheaper to make here.
It makes manhours cheaper in the short term.
All other raw materials and energy costs are internationally traded commodities so unless they had fixed long term contracts in £ they will all have gone up by the same amount the currency went down.
In the long term wages also go up with inflation if things go averagely well (likely/unlikely?), or people get poorer if they don't.
Growth by currency manipulation only works if you can keep manipulating the currency (China).
Basically whenever someone says "manufacturing benefits from a weak £" what they really mean is workers are cheaper (and thus poorer).
22,300 staff according to their website.
This is more to do with a duff engine and shareholders than Brexit - I would imagine they are having to pay a fair amount of compensation out to airlines for lost airtime.
I meant "I'd be amazed if Rolls Royce Cars employ 4000 people in the UK" they don't, they employ 1300 people globally.
JLR aren't "moving manufacture out of Britain". They're bringing a new factory on line to produce some cars, whilst changing a current factory to produce newer cars. So they're actually increasing manufacture globally and keeping production level the same in the UK. Just a different model.
JLR have a major 'proble'm that they comfortably sell every car they make and they want to increase production by 100% over the next few years. They can't do this as their existing factories are at capacity so they have to build new ones, like the Nitra one.
If you see JLR's investment in the UK as well as oversees, you'll see the company is spending well in the UK as well. It's good business sense to spread your production round the world - and they've been doing that for years.
RR issues are self-inflicted
If ‘the beginning’ you speak of is a financial collapse because of the ‘B word’ it’s unlikely to hurt manufacturing as much as other industries, our currency is still 10% weaker than it was before the referendum and that makes stuff cheaper to make here.
Hold on is that you Jamba or is it THM?
JLR would be best suited to moving thier manufacturing base in Europe, only an idiot would keep all thier manufacturing in one place ie: britain.. after all they’re chasing a world market and China is thier main expanding marketplace (like all other manufacturers)
As for the RR connection “apparently” rather than the Brexit angle it’s more to do with maintaining shareholder confidence, even though they made £bn’s in profit last year. Also, they’re developing leaner engines and need less middle management as the lean supply chain improves.
So, partly Brexit yes but mainly maintaining shareholder confidence and lean manufacturing process.
<div class="bbp-reply-author">Drac
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<div class="bbp-reply-content">If ‘the beginning’ you speak of is a financial collapse because of the ‘B word’ it’s unlikely to hurt manufacturing as much as other industries, our currency is still 10% weaker than it was before the referendum and that makes stuff cheaper to make here.
Hold on is that you Jamba or is it THM?
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Ha ha, no but in life I think it's important not to be polarized or 'tribal' - leaving the EU isn't all bad and nor is remaining all good. Why do you think Corbin was so weak in the referendum? He's old-school, protectionist, manufacturing industry biased. He gets a chubby at the idea of the UK being the workshop of the world again with the Labour voting Shop Steward at every corner, if the £ is only worth €0.5 / $0.5 and China and the rest of the Far East continue to become more affluent he may get his way and yes, workers will be relatively poorer, be we'll all be happy as long as we're working to better the state eh comrade?
Of course that weird Rees-Moog ****er, Boris the Bellend, Dacre and well Jamba the alchemist what the UK to be a tax haven and shady world bank so they can continue to increase the gap between poor (us) and the rich (them) - whilst a few of us might still enjoy buying toaster for £3 because the £ is worth a trillion Yuan, more people will join the ranks of the 'underclass'.
All I hope is that this “government” doesn’t step in and assist, a)because the business isn’t failing and b)they’ve never stepped in and helped other business in the same position.
Loads of people live and work in the Derby factory, it’ll be very bad news there for a long time indeed.
A devalued currency does not of itself lead to an increase in demand for exports, that depends on levels of demand for those goods and services in other countries. The falling value of sterling has not stimulated demand but it has made families £900 per year worse off.
Are they all being herded onto the “B” Ark?
Restructuring a huge and diverse business
Better explanation here
https://www.ft.com/content/b5630c48-6f57-11e8-852d-d8b934ff5ffa
Makes you wonder what 4200 middle managers do there and what jobs theyre going to apply for, in a reducing fulltime workforce generally.
what does middle management do anywhere? Unfortunately it's a catching pot for people who are not going to make it any further. If it's voluntary a good chunk of those could well be early 50's well down on a small mortgage and ready for a break. It then creates room for the bright young (er) things to move up and have a career.
If you make a job redundant you cant then place somebody else in tat job as that job doesnt exist anymore.
But 4200 jobs going what do they do that now doesnt need doing anymore
The role is redundant, in any reorganisation you get rid of people from one area and invest in other areas. you can change the people around that way, this is a successful business that is doing well just in a lot of areas.
making massive loses as well.
edited
"making massive loses as well."
Who's making massive losses? Not Rolls-Royce. 2017 results were £2.9bn profit, £15bn revenue, £273m free cashflow, a pension that is massively in surplus, all up from the previous year, and all this is taking into account the costs of fixing in-service issues.
"But 4200 jobs going what do they do that now doesnt need doing anymore"
Rolls-Royce is a large global business that has expanded and grown massively over the last 20 years so over the time it's become inefficient and complicated, so It's about reducing the layers of management from about 18 levels to about 8 or 9. It's not just a case of getting rid of jobs, its a re-structuring, so stuff like combining business units and eliminating duplication, outsourcing routine and repetative tasks to external companies and agencies, integrating businesses that have been acquired, simplifying what is a pretty complicated and inefficient organisation. Their senior management went through a similar process about 2 years ago.
So not about Brexit (the vast majority of products are exported to non EU countries and most suppliers are from non-EU companies), not about the exchange rates (they obviously hedge currencies so protected against currency fluctuations), not about in-service issues (the cost of which has already been declared in last years financial results), not about poor financial results (financial results last year were strong and growing).
4.6 billion loss is not spare change you find at the roadside though.
4.6 billion loss? you're 18 months out of date. the loss was reported in the 2016 results and was a result of a change of accounting rules and an adjustment has to be made that year, but revenue an cash were positive. 2017 end of year results £2.9bn profit.
According to the RR spokesman I heard many of those going are engineers - which feels short sighted.
Rolls-Royce has just launched 3 brand new engine programmes in the last 12 months, which is pretty unprecedented in the industry. So there has been a significant and very intensive, not to mention extremely expensive, engineering effort going on over the last 5 years or so as those engine programmes were designed and brought to market - now they're in service they can start earning some revenue. There are currently no new engine programmes on the horizon for the foreseeable future as Boeing and Airbus have no new aircraft coming down the pipeline, maybe something in the mid 2020's at the earliest, so the amount of engineering resource needed over the coming years has dropped off a cliff, however RR still has to maintain and increase its investment in R&D so it is ready for the next engine programme with the latest technology - over £1bn a year on R&D, so not exactly small beer, so running the business in as cost effective and efficient way possible is absolutely essential. It's a big shame for those affected of course, engineers or otherwise, but it is a project based business and projects come and go - sometimes they overlap, sometimes they don't and there is a gap between projects. There will still be alot of engineers left - it is an engineering company after all.
As one of the people who has been put 'at risk', it's interesting to see the outside perception of this.
Thanks for the sympathetic words from you all.
It's a crappy time in the pook household at the minute. Mrs pook off ill, mini pook excited cos he heard Rolls-Royce mentioned on the radio.
I'm not aware that any engineers are going (it was put across as middle management and admin). This is apparently about simplifying the structure and removing duplicate positions from the reduction of business units.
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<div class="bbp-reply-content">As one of the people who has been put ‘at risk’, it’s interesting to see the outside perception of this.
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Shit I feel bad now for starting the thread but at least you now know the people feel for you even if.
Good luck Pook. It’s easy to forget the human element when these things are discussed. The numbers announced are about 4K people with about half of that coming from Derby, so circa 2k people out of 15k, so hopefully the odds are way in your favour. If VS is offered i’m sure there will be plenty of people willing to go and compulsories avoided.
Business makes 2.9 billion pounds profits and sack 4000 people in same year and it is acceptable ?
Sorry but this is very wrong.
oh I'm out, I know that
Business makes 2.9 billion pounds profits and sack 4000 people in same year and it is acceptable ?
who should it be acceptable to, though ?
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Business makes 2.9 billion pounds profits and sack 4000 people in same year and it is acceptable ?
Sorry but this is very wrong.”
Well it’s either that or allow the business become uncompetitive, fail and then ‘sack’ 50k people when the business goes bust.
this is about the long term survival of the business, and the business having to change its shape to face the next 10 years. Now the new products are in service they have to make the returns from them to pay back the development costs and fund the next programme.
£2.9bn doesn’t go very far in aerospace. RR invests over a 1bn every year in R&D alone.
Business makes 2.9 billion pounds profits and sack 4000 people in same year and it is acceptable ?
Sorry but this is very wrong.
And if those people don't fit with the work that needs to be done w ha t do you do then?