By Robert Wall
British aircraft-engine maker Rolls-Royce Holdings PLC (RR.LN) on Thursday said it will shed 4,600 jobs only days after warning of new problems with one of its flagship products powering Boeing Co. (BA) 787 Dreamliner planes.
The cutting of about 9% of the company's 55,000 employees is only the latest round of job reductions Chief Executive Officer Warren East has implemented in his three year effort to make Rolls-Royce more competitive.
The effort has been beset by setbacks such as faster wear-and-tear on components used on different engine models, including those used on some Dreamliner long-haul jets and others powering Airbus SE (AIR.FR) A380 superjumbos.
Rolls-Royce said it will incur 500 million pounds ($670 million) in costs associated with the staff reductions, to be booked across 2018, 2019 and 2020. The company said it expects annual net cost savings from the restructuring of GBP400 million by the end of 2020.
Rolls-Royce, no longer affiliated with the luxury-car maker, had announced more than 5,000 job cuts in recent years. The company in 2016 slashed its dividend amid slumping profits.
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(END) Dow Jones Newswires
June 14, 2018 02:29 ET (06:29 GMT)
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