UK-based engineering group Rolls-Royce has announced its plan to cut 800 additional jobs in its marine business amidst continuing weakness witnessed in the global maritime market.
The move is estimated to help the company to save £45m-50m per annum from mid next year, and enable further simplification of its marine business, with the senior management team being streamlined.
According to Rolls-Royce, the proposed marine restructuring plan would cost the company approximately £20m, split between this year and next.
Under the restructuring initiative, the company is planning to set up a research and development (R&D) centre to develop new propulsion products and an expanded services hub for Northern Europe, both in Ulsteinvik, Norway.
Furthermore, the organisational change is aimed at putting more focus on developing new electrical and digital technologies for the maritime sector.
Rolls-Royce’s marine business currently provides several technology and services to customers operating in merchant, offshore and naval vessels.
Rolls-Royce marine president Mikael Makinen said: “The ongoing market weakness that has followed the dramatic fall in the price of oil continues to have an adverse impact upon our order book and profitability.
“We have made significant progress in transforming marine into a far more agile and simplified business than we were and we have to take further steps to address our cost base.
“Reducing our workforce is never an easy decision, but we have no option but to take further action beyond the changes we have made to date. This remains a fundamentally strong business, but we need to overcome the immediate challenges and focus our investments on the technologies that will shape our future growth.”
In May and October last year, the company announced 1,000 job cuts from unspecified business.
The company’s marine business currently employs around 4,800 people in 34 countries.