Unrest at Rolls-Royce despite job security

Are you always struggling with the main company? When Rolls-Royce boss Tufan Erginbilgic announced a big profit increase for the group on Tuesday, employees of the Power Systems division gathered in Friedrichshafen for a work meeting.

Works council chief Thomas Bittelmeyer and human resources director Thelse Godewerth had good news for them: the so-called futures contract will secure employment until 2026. But Bittelmeyer warned of the consequences of the German subsidiary considering the plans of the top management of company in London.

It’s about to become an internal company record: More than 4,300 Rolls-Royce Power Systems employees came to a job fair at the Friedrichshafen trade fair on Tuesday. “If there had been fewer, we would have run out of seats,” Thomas Bittelmeyer said at a press conference afterward.

The parent company is planning major job cuts

No wonder: some tension between the workers has increased in the last few weeks. Rolls-Royce’s parent company recently announced that it wants to cut 2,000 to 2,500 jobs worldwide. And in what is known as Capital Market Day, the day for investors, CEO Tufan Erginbilgic announced that the group wants to increase its operating profit – and return to shareholders – in the next few years.

There was strong criticism for this from Power Systems board boss Thomas Bittelmeyer: “I have the feeling that as much money as possible should be thrown as quickly as possible to please the investors,” he said. He described Erginbilgic’s plans as “illogical”.

There have long been signs that Rolls-Royce wants to cut staff – even in areas of the business that are in the black, such as Power Systems.

Criticism of planned “centralization”.

This makes it even more important that the works council and the management of the company have agreed on the future contract for 2026. This contract does not include layoffs at the engine manufacturer until 2026. Job cuts are only possible on a voluntary basis – for example when employees retire .

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In this way, the company participates in the downsizing of the parent company – even if, according to human resources director Thelse Godewerth, it is not yet clear how many positions. There should be clarity on this in the first quarter of 2024. “But Power Systems will make its contribution,” said Godewerth.

But what is already clear: cooperation with London should be strengthened. In “cross-functional work” – for example in finance or human resources, but also in “engineering” – the aim is to “use collaboration” and avoid double responsibilities. Godewerth called it “unification”, Thomas Bittelmeyer spoke of “centralization” – and criticized: The fact that diesel engineers and turbine engineers have to work together is crazy – the areas could not be more different, according to the boss of the works council.

The division of the company is put to the test

To position Rolls-Royce Power Systems for the future, they want to focus on certain strategic areas, explained Thelse Godewerth – for example on the navy or the so-called government business, which includes the construction of tank engines.

Other areas, however, would be explored. The fuel cell project, for example, is “denied priority”. And other parts of the company also want to be investigated. “There is still no decision on this,” Godewerth said.

However, given that Power Systems’ order books are full, he was generally confident: “We have a strong position within the group of companies and we are heard in London.”