Rolls-Royce is embroiled in a new row over manufacturing jobs leaving the UK after admitting that a new hi-tech facility is likely to be based in Germany or the US instead of Derby.
The company told workers that it was considering non-UK locations for new aircraft engine test-beds rather than Derby, its biggest engine site. The news comes a month after Bombardier dealt a blow to manufacturing in the city and in the UK by announcing the loss of 1,400 jobs at its train-making factory after the government chose Germany's Siemens for a £1.4bn carriage contract.
A senior official at the Unite trade union, which represents around half of Rolls Royce's 11,000-strong workforce in Derby, said the test-bed move would benefit workers in Germany or the US over the UK. "This has potentially long-term implications for Derby's manufacturing base," said Adrian Uxtell, regional secretary for the East Midlands. "Work follows the experimental test-beds and a significant number of jobs in Derby are linked to development projects. Rolls-Royce, with the support of the government, need to do everything possible to maintain its development projects in Derby in the long term."
One trade union source said the announcement, briefed to Derby employees last week, hit staff "like a ton of bricks" and exacerbated concerns about the future of manufacturing in Derby in the wake of the Bombardier announcement. Uxtell added: "The uncertainties arising from Rolls-Royce's plans go to show why the government should support Bombardier when it can instead of allowing the work to go to Germany." Rolls-Royce employs 39,000 people and manufactures in 20 different countries.
The announcement by Bombardier that it intends to cut 1,400 jobs has cast a pall over Derby and triggered widespread soul-searching about Britain's industrial competitiveness, as well as the structuring of government procurement contracts that are forbidden, under Brussels guidelines, to show bias to domestic manufacturers. Unite's executive officer, Tony Woodley, said he expected the 172-year-old train plant to close, losing a further 1,600 jobs, if the government finalises the deal with Siemens, which is the preferred bidder to build 1,200 carriages for the Thameslink route.
Woodley, who will address Bombardier workers on Tuesday, said that without that deal the Canadian-owned firm could not keep the factory going until the next major UK order, for the £16bn Crossrail project. "It is not possible for a company this big to survive without work between now and Crossrail."
Rolls-Royce dismissed concerns that the strategy for test-beds, where engines are put through their paces before delivery, was a further threat to UK jobs. It said the decision to built test-beds outside the UK would have no impact on the group's domestic plans, where the Derby plant will continue to build and test the Trent XWB engines for the new Airbus A350 aircraft due to launch in 2013.
The Trent XWB has received more than 1,100 orders so far, making it the fastest-selling engine in the company's history. Rolls-Royce's order book, dominated by demand for its aircraft engines, is now worth £61.4bn. It is understood that the new test-bed facility in the US or Germany will be modest in size.
A Rolls-Royce spokesman said: "Rolls-Royce is investing billions of pounds, in the UK and around the world, so that it can keep up with customer demand and fulfil its £60bn order book. For example, the company needs to double the number of Trent engines it produces to power the next generation of wide-body planes. As part of that expansion we have confirmed we will assemble and test Trent XWB engines … in Derby, which is our centre of excellence for large engines. This will sustain jobs at Rolls-Royce as well as in the hundreds of British companies in our supply chain. We also need additional engine testing capacity, and we have formally opened consultation regarding potential options."
Source: http://www.guardian.co.uk
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