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JCB announces 950 jobs at risk as coronavirus crisis halves demand

By John Corser | Mid Wales | Business | Published:

JCB says that up to 950 jobs are at risk of redundancy at its plants including after demand for its machines fell by half as a result of the Covid-19 crisis.

JCB is cutting around 950 jobs amid a slow down in demand including at its headquarters in Rocester

The news comes just days after the digger giant restarted production at some of its sites including in Rocester, Cheadle and Uttoxeter in Staffordshire and Wrexham.

The company wrote to employees to advise that up to 950 staff roles are under threat at its 10 plants in Staffordshire and Wrexham and that a 45-day consultation period will begin on Monday.

Around 500 Guidant agency employees, who work at JCB’s UK sites, are also being released from the business.

The job losses have been announced as a result of the severe disruption caused to JCB’s business by the coronavirus crisis, which will see annual production halved.

JCB chief executive Graeme Macdonald said the decision to restructure JCB’s business had been extremely tough but that the company “had no choice but to take difficult decisions to adapt to this new economic reality”.

He said: “In 2020 we had planned to sell and produce over 100,000 machines. With so much global uncertainty, that figure right now is looking more like 50,000 machines.

JCB has introduced safety measures on its production lines

"In the UK, around 85 per cent of everything we manufacture is exported and our UK factories will now produce machines at half the rate we had planned just a few months ago. As a result, we have no choice but to align our cost base to demand for the rest of the year.

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“It is deeply regrettable that we have had to take these steps to restructure the business and that it will have an impact on so many people. No business could have anticipated the scale of the Covid-19 crisis and its economic consequences. JCB has had to act quickly for the long-term survival of the business, which has been at the heart of our decision-making throughout this difficult period.”

JCB currently employs around 6,700 people in the UK, including agency employees. A 45-day consultation over the proposed JCB job losses will begin on Monday when discussions with staff representatives will start. The vast majority of JCB’s employees are currently furloughed until the end of May after production at UK factories stopped in March in the wake of the crisis.

Mr Macdonald added: “The Government’s taxpayer-funded Job Retention Scheme, which was a temporary measure that has seen most UK employees furloughed since the beginning of April, was never going to be capable of sustaining employment at companies having to face such reduced levels of demand.”

The machinery manufacturer had confirmed it had turned over production to creating special housings for a new type of ventilator to help the NHS as the virus outbreak gripped the country.

But following Government confirmation last week that they were no longer needed, production was halted, allowing the firm to refocus on demand for agricultural machinery.

John Corser

By John Corser
Business Reporter - @JohnCorser_Star

Express & Star Business Editor at head office, Wolverhampton. Welcomes all news of companies and business organisations.

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