BAE Systems is to eliminate nearly 2000 jobs, slow down production of Typhoon jets and streamline operations in order to meet the challenges caused by a slowdown of military orders and a focus on cost-cutting.
The job cuts are expected to fall mainly on the Warton and Samlesbury plants in Lancashire which have a focus on aircraft assembly and collectively employ around 10,000 people.
Production of the Typhoon is to be slowed to avoid having to cease production completely - the current order backlog would otherwise be exhausted in 2019. This buys the company some time to clinch new orders that will possibly come from Qatar.
The company structure will also be streamlined to achieve cost reductions and speed up decision making.
The CEO of BAE Systems, Charles Woodburn, said:
“BAE Systems is a world leader in technology, advanced manufacturing and engineering and our diverse portfolio provides a strong platform for future growth. The organisational changes we are announcing today accelerate our evolution to a more streamlined, de-layered organisation, with a sharper competitive edge and a renewed focus on technology. These actions will further strengthen our company as we deliver our strategy in a changing environment.
Separately, we are also announcing actions at some of our UK sites to align our workforce capacity more closely with near-term demand and enhance our competitive position to secure new business. Those actions are necessary and the right thing to do for our company, but unfortunately include proposed redundancies at a number of operations. I recognise this will be difficult news for some of our employees and we are committed to do everything we can to support those affected.