McLaren to cut over a quarter of its workforce
According to a statement issued by the McLaren Group just two days before its financial results are due, 1200 of its 4000 employees are now set to be made redundant. McLaren says the business has been “severely affected” by the crisis; demand for its supercars has dropped, and the delayed start to the 2020 Formula 1 and Formula E championships has dried up the brand’s motorsports revenue.
McLaren Automotive recently invested in building its new composites technology centre in Sheffield, only for its sales momentum to drop. The comfort-oriented yet still mid-engine McLaren GT failed to reach its target group, while the production cap of the Elva, McLaren’s last Ultimate Series model before 2025, has been dropped from 399 units to 249. Charging $1.85 million for a speedster that can only enter the U.S. with a windshield doesn’t seem to be the theme of 2020.
Earlier reports also suggest that the company may follow Williams’ lead by putting a mortgage on its Norman Foster-designed headquarters and highly valuable race car collection.
When it comes to its Formula 1 operation, McLaren is expected to lose less than 10 percent of its staff, but there will be a second phase of cuts next year when the budget cap agreement comes into play.
McLaren’s Executive Chairman is Paul Walsh, who joined the McLaren Group from alcoholic beverage giant Diageo just two months ago, accompanied by a $365 million equity investment by McLaren’s investors. He didn’t have much to add:
“This is undoubtedly a challenging time for our company, and particularly our people, but we plan to emerge as an efficient, sustainable business with a clear course for returning to growth.”