Rolls-Royce said today that it was to axe up to 2,300 jobs in the UK, Europe and US as it seeks to trim costs.

The group declined to confirm how many jobs in the UK would be cut, but said it would seek to secure voluntary redundancies where possible.

Rolls-Royce employs around 23,300 people in the UK at bases in locations including Derby and Bristol. It said managerial, professional and clerical roles would be affected.

Union representatives for Derby's Rolls-Royce employees are to "seek clarification" from the company on where the cuts will be made.

With a workforce in the city of around 12,000, including 7,000 white-collar workers, the manufacturer is its biggest employer.
And the Rolls-Royce plant in Sinfin is the company's largest in the UK.

Mark Tittley, joint chief negotiator (staff) of the union Unite for Derby, said: "Rolls-Royce is the major employer in Derby. Clearly, any announcements of major job reductions, albeit the 2,300 job losses are on a global basis, is very concerning to employees of the company.

"The workforce are worried by this. As yet, we have not had a breakdown on the number of jobs to go in Derby. We want the work done properly but we will be seeking clarification."

Mr Tittley said the union is working on how many of its members will be accepting the voluntary severance package being offered from Monday.

Bernie Hamilton, national officer of Unite, said: "We understand the competitive nature of the aerospace sector and the disproportionate effect that the weakened dollar against the pound is having on the industry.

"Unite will do everything it can to help the company remain competitive, recognising that this announcement comes at a time of a healthy order book and recent successes in gaining new orders.

"Any jobs lost are disappointing but we will not accept any attempt to make compulsory redundancies."

The engineering firm added that the cuts would focus on overhead and support functions in the UK, US, Germany, the Nordics and "other countries where the relevant functions are located".

The headcount reduction will help the group offset higher costs in raw materials as well as the weak US dollar, according to Rolls.  The group said on unveiling half-year results in July that the decline in the strength of the dollar had cost it £40 million in additional costs, while it was also seeing a rise in unit costs from increased raw materials.

It said at the time that it would seek to tackle the rising cost pressures by increasing its dollar-based sourcing, overhauling its supply chain and achieving productivity efficiencies from its investment in new manufacturing bases.
But Rolls was still able to post a better-than-expected 17% hike in interim underlying pre-tax profits, at £380 million, despite the cost rises.

Rolls-Royce chief operating officer Mike Terrett said: "We are determined to create a leaner and more agile support structure, better suited to the global markets in which we operate. The investments we have already made in new management systems will help us deliver this simplified organisation.

"Rolls-Royce will continue to focus on ongoing cost reduction and productivity improvements."

The company stressed that today's job reductions would not hit its 2007 financial results and said that associated costs in 2008 would be largely offset by savings made group-wide.