GKN Aerospace to axe 1,000 jobs

GKN Aerospace is to axe around 1,000 jobs over the next two years in a restructuring drive in plans it said pre-date its £8bn hostile takeover by Melrose when it promised to invest in the business.

The aerospace and defence supplier said the cuts would hit non-production jobs with a focus on back office and support functions.

The company said the business has grown rapidly by acquisition over recent years, increasing in scale from £600m turnover in 2006 to more than £3.5bn at the end of 2018.

“Today, it is structured with four independent divisions, each focused around products and internal capabilities. In the new structure, GKN Aerospace will fully integrate as one business, with customer-facing teams and a single, connected network of global sites, all supported by shared services,” the company said.

“The new structure will enable the business to better serve its customers, improve operational performance, collaborate internally and maximise its potential for future growth.”

The Redditch-based company, which employs 18,000 workers, of which 3,500 are in UK, said the decision pre-dates the controversial £8bn takeover by Melrose, when Melrose secured 52.4% of the voting rights of GKN in support of its bid.

It was then approved by the Government following written commitments from Melrose to invest in the business, keep GKN’s headquarters and stock market listing in the UK and promising not to sell the GKN Aerospace division within five years without government permission.

However, it has since been accused of breaking promises by MPs, after it revealed plans in April to shut the Kings Norton site in Birmingham with the loss of 170 jobs.

GKN Aerospace said the restructuring is part of a longstanding plan to combine its four divisions into one.

Hans Büthker, chief executive of GKN Aerospace, said: “We are creating a single, fully integrated business aligned to our customers’ needs, which will ensure we are better positioned within the competitive global aerospace market.

“Our rapid growth has brought us world-leading technology, an outstanding global footprint from which to support our customers, a balanced portfolio of work across all major aircraft platforms, and great people. It has also made us relatively complex. By taking the next step and fully integrating, we can begin to realise our full potential.”

The reorganisation will take place within the next two years.

Büthker said: “This is a fundamental transformation of the business and it is the right move for the long-term as we move into a more coherent business structure. The reduction in roles is difficult for all involved and we will work closely with Works Councils and social partners in all our key regions over the coming months to minimise the impact wherever possible, and ensure the process is managed in the most appropriate way.

“Looking ahead, when this restructure is complete, we will be simpler, stronger and more successful,” said Mr Büthker.

“We will be better able to standardise our processes and internal systems, and therefore drive up operational performance. We will be able to collaborate and share best practice more effectively across our network of sites. We will be able to offer our full range of technology to customers via clear customer-facing teams. In all, we will be more efficient and better positioned for future growth.”

GKN Aerospace has 50 manufacturing sites across 15 countries.

Although one-tenth of its 60,000 staff are employed in the UK it is seen as having an important role to play because of its defence contracts and importance to the supply chain.