Is Rolls-Royce preparing to lay off 30% of workforce?

The luxury car brand is in the process of streamlining operations


Rolls-Royce is undergoing a streamlining exercise to increase efficiency. The process will involve some transformation and important changes in the structure / management.

With consultants McKinsey advising the firm on the process, media reports say that the luxury car manufacturer may actually trim its workforce by 10 per cent, laying off about 30,000 members. It is also planning to cut costs and reduce investments in non-core areas.

The effect of the trimming will be seen in the non-manufacturing divisions in defense, power systems as well as civil aerospace wings, as reported by The Times. The maximum brunt may be borne by the Derby headquarters, where the majority of the back-office work is handled.

The company, however, maintains that nothing has been finalised yet regarding the workforce.

The transformation process is being launched under the supervision of Tufan Erginbilgic, CEO, Rolls-Royce.

Erginbilgic joined the company in January this year and post taking over, he had expressed his concern at the way the company had been mismanaged. In fact, he had actually called the company a ‘burning platform’, particularly targeting the power systems division —which produces engines for ships and trains and is responsible for contributing a significant share of the company’s revenues — making shareholders and investors very uncomfortable.

After many years of low profits, it is only now, in 2023 that the company has performed better than expected, thanks to a surge in global travel.

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