JCB cuts UK production as coronavirus hits supply chain

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JCB is cutting UK production and working hours as it faces a shortage of components from China due to the coronavirus outbreak.

The move will mean a shorter working week for around 4,000 JCB and agency shop floor employees from Monday and an immediate suspension of all overtime.

The working week will be cut from 39 to 34 hours while workers continue to be paid for 39 hours, but will have to work the extra hours later in the year.

JCB 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.

“Production in the UK has so far been unaffected by the situation in China. However, more than 25% of JCB’s suppliers in China remain closed and those that have reopened are working at reduced capacity and are struggling to make shipments.

“It is therefore clear that the inbound supply of certain components from Chinese partners will be disrupted in the coming weeks as they seek to replenish their stocks. 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 period of supply disruption has passed.”

The article was originally seen at: https://www.constructionenquirer.com/2020/02/14/jcb-cuts-uk-production-as-coronavirus-hits-supplychain/

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