Bentley is the latest British car brand to announce significant job cuts.
The luxury brand, part of the Volkswagen Group empire, wants to cut almost a quarter of its workforce despite record profits in the first quarter of this year.
Autocar reports the company has written to all 4200 of its contracted employees to offer a voluntary release package. It wants 1000 of its employees to take it voluntarily, though compulsory redundancies are on the table.
The move is part of the company’s new restructuring plan, Beyond100, which aims to make Bentley more economically and environmentally sustainable in its second century.
Though Beyond100 was already part of Bentley’s plans before COVID-19 led to the temporary closure of its Crewe factory, the shutdown has underscored Bentley’s desire to cut costs.
During the seven-week period where production was halted, the company lost £22 million (A$40 million) each week. Revenue this year is expected to be down by between 25 and 30 per cent as a result.
Though production resumed on May 11, Crewe is operating at only 50 per cent due to social distancing requirements. According to Automotive News Europe, around 500 of its employees will remain on furlough until later this month. At one point, two-thirds of the company’s workforce was on furlough.
To make the brand more environmentally sustainable, Bentley plans to offer a plug-in hybrid version of each of its models by 2023. These will be positioned as the flagships of their respective lines.
As Bentley announced previously, it’ll also introduce an all-electric car in 2025, though delays due to the shutdown could push its launch into early 2026. Bentley also plans to make all of its cars zero-emissions by no later than 2040.
Bentley’s environmental initiatives go beyond electrifying its vehicles. CEO Adrian Hallmark has said the company will “invest in carbon-neutral materials that are ethically sourced and environmentally sustainable”.
The Crewe factory has already been made carbon neutral, while Bentley plans to source more sustainable materials such as riverwood and trees that have already fallen.
Bentley’s financial situation is better than that of its fellow British automakers, however.
In a record performance for the brand, Bentley posted a €54 million (A$87.4 million) profit in the first quarter of this year. It had returned to profit in 2019 under the leadership of CEO Adrian Hallmark, who joined the company in 2018.
Though the company has become more profitable, its overall production volume has remained steady over the past decade despite the introduction of the Bentayga SUV. The brand, however, isn’t chasing volume, with Hallmark declining to set sales targets. Instead, the focus is on predictability and profitability.