Rolls-Royce reorganisation statement

In response to news this week of job cuts at Rolls-Royce, Andrew Bradley, Chair of the Aerospace Board at the Institution of Mechanical Engineers, commented:

“This week Rolls-Royce has announced plans to reduce its workforce by 9000, the vast majority of which will be in its Civil Aerospace division. This is a sad reflection of the hit to the Civil Aviation market by Covid-19. Boeing has estimated that for 2020 worldwide Revenue Passenger Kilometres will reduce by 50% from 2019 levels.

The prediction is that levels will not return to those of 2019 until 2023 or 2024, whilst the industry had been planning on 20% growth over that time.  Resulting from this, both the largest customers of Rolls-Royce Civil Aerospace new products, Boeing and Airbus have dramatically cut aircraft production and the airlines that look to Rolls-Royce for maintenance and spares have cut their operations.

The response of Rolls-Royce is likely to be mirrored in their supply chains and those of Boeing and Airbus so the overall effect on the industry is still emerging.  The challenge for Rolls-Royce and these other companies is to ensure that they will be in a strong enough position financially, have capability in technology and retain sufficient skills to be able to resume growth though increasing capacity and offering new products when the market seeks them.

It may well be that when the market does come back it will be looking for air transport that is significantly different from today’s, driven by climate change concerns or a shift to more personal transport.  Therefore, it will be essential that those companies continue to develop ideas and collaborate to ensure that an integrated way forward for the industry is developed. Professional Engineering Institutions, such as the Institution of Mechanical Engineers, and governments must play a key part in this.”

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