LONDON - British engine maker Rolls-Royce will axe another 400 jobs at its marine division, it said Monday, as slumping oil prices weighs on demand for vessels.
Rolls announced in a statement that it will reduce its number of employees by 400 by the end of next year, on top of 600 job cuts already unveiled in May.
"After many years of strong performance through to 2013, led by good growth in the oil and gas sector, our order book and profitability have been adversely impacted by the sharp and subsequently prolonged drop in the price of oil," said Mikael Makinen, President of Marine at Rolls-Royce.
"Reducing our workforce is never an easy decision, but the continued weak oil price, and the need to become more competitive, means it is necessary, if we are to build a strong base from which we can successfully grow this business in the future." The latest cutbacks are forecast to generate full-year savings of £40 million ($61 million, 54 million euros).
The group's marine division, which employs about 5,800 people in 34 countries, supplies technology and services to customers operating merchant, naval and offshore vessels.
In morning deals, Rolls-Royce shares rallied 2.84 percent to 724.50 pence on London's FTSE 100 index, which was 1.83 percent higher at 6,242.35 points.