Rolls-Royce Marine to cut more jobs

Low oil price causes profit fall at marine engine builder

The marine division of aero-engine maker Rolls-Royce is to cut 400 jobs as it continues to reduce costs because of the low oil price.

The 400 jobs, reported to be management positions, follows an announcement in May that 600 workers would have to be axed from within the marine division, mainly from Norway.

Rolls-Royce Marine has a substantial customer base in the oil and gas sector, and orders have fallen sharply as the fall in the oil price continues to impact on that sector.

Mikael Makinen, president of Rolls-Royce Marine, said: “After many years of strong performance through to 2013, led by good growth in the oil and gas sector, our order book and profitability have been adversely impacted by the sharp and subsequently prolonged drop in the price of oil.

“This is a fundamentally strong business, but we have to take decisive action to position it for future growth, with a structure that is simple, efficient and effective. At the same time we will sharpen our focus on the marine technologies of tomorrow by significantly increasing our current rate of investment in research and development.

“Reducing our workforce is never an easy decision, but the continued weak oil price, and the need to become more competitive, means it is necessary, if we are to build a strong base from which we can successfully grow this business in the future.”

Rolls-Royce's Marine business employs 5,800 people and last year accounted for £1.7 billion of Rolls-Royce's total £14.6 billion.