JCB cuts working hours for 4,000 UK employees as coronavirus hits suppliers
Shop floor employees will work a 34-hour week from Monday as the knock-on impact of Chinese factory closures creates disruption.
Thursday 13 February 2020 18:40, UK
JCB has become the first big UK manufacturer to cut production as a result of the coronavirus outbreak hitting suppliers in China.
The decision will mean a shorter working week for around 4,000 employees at the digger maker from next Monday as well as an immediate suspension of overtime.
JCB said it was taking the decision as more than a quarter of its suppliers in China remained closed while those that had reopened were operating at reduced capacity and struggling to make shipments.
It illustrates the widening impact of the outbreak on the global economy, having already resulted in widespread factory closures in China and car factory stoppages in Japan and South Korea due to supply issues.
JCB's measures will see the introduction of a 34-hour working week for JCB and agency shop floor employees "until further notice".
Those employed directly by JCB will be paid for a 39-hour week and bank the hours to work them back later in the year.
Chief operating officer Mark Turner said: "The disruption to the component supply chain in the UK comes at a time when demand for JCB products is very strong, so while this course of action is very unfortunate, it is absolutely necessary to protect the business and our skill base."
Mr Turner said production in the UK had so far been unaffected but the situation for its Chinese suppliers meant there would be disruption in coming weeks.
"This inevitably means we will not have the required amount of parts needed to build our forecast number of machines in the short term," he added.
"These measures will ensure that, while we will produce machines in lower than anticipated numbers, we will do so with the same number of employees, whose skills we will need to fulfil customers' orders when the situation returns to normal.
"We are keeping the situation under review and we anticipate a surge in production levels once this supply disruption has passed."
JCB, controlled by the Bamford family, is one of Britain's biggest manufacturers and the distinctive yellow construction vehicles and equipment it makes are among the most recognisable of UK exports.
Its chairman Lord Bamford is a prominent Brexit supporter and its factory in Uttoxeter, Staffordshire, was the scene of an election campaign stunt last December when Boris Johnson drove a digger emblazoned with "get Brexit done" through a makeshift wall.
JCB employs 15,000 people worldwide including 7,500 in the UK, with factories in the Midlands and north Wales which will all be affected by the latest announcement.
Its overseas plants - which are mainly in India - are not affected.