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McLaren is to lay off 1200 of staff members across its organisation in order to conserve costs amid the ongoing economic crisis caused by the coronavirus pandemic.
The number of people made redundant will add up to 25% of McLaren's entire workforce and the cuts will be spread across its Formula 1 team, its road car division and Applied Technologies.
Last month, McLaren announced that it had placed some of its F1 staff on furlough as part of the Coronavirus Job Retention Scheme.
The budget cap will exclude all marketing expenses, race driver payments and the charges of the team’s three highest-paid personnel.
Paul Walsh, the McLaren Group's executive chairman stated: “We deeply regret the impact that this restructure will have on all our people, but especially those whose jobs may be affected.
“It is a course of action we have worked hard to avoid, having already undertaken dramatic cost-saving measures across all areas of the business. But we now have no other choice but to reduce the size of our workforce.
“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.”
Earlier this month, it was reported that McLaren was looking to mortgage the McLaren Technology Centre in Woking and its classic cars in order to raise £275 million.
More teams are likely to lay off staff as the budget cap looms, however Ferrari has confirmed that it is looking at a potential IndyCar entry which would allow it to keep members of the team employed but place them in a different racing series.
McLaren has picked up more sponsors over the last couple of years and enjoyed a strong 2019 season, finishing fourth in the constructors' championship - its highest finishing position since 2012.
A majority of the McLaren Group's sales stems from its road car division, while its racing activities pull in roughly 20% of its revenue.
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Replies (7)
Login to replyPistonhead
Posts: 556
Really sad and will be a bit of kick in the teeth for those losing their jobs when they check out RICs incoming salary. No doubt the argument will be the F1 business stands alone in its financing and thats fair enough on one level but it is going to hurt.
ajpennypacker
Posts: 2,475
It's very sad. But hiring Ricciardo is about a lot more than what he can do on track (which has very limited revenue potential). The greater value comes from the image it creates to have a top talent like Daniel. Having a very marketable driver who will attract sponsors, who can be very camera friendly for advertising, events, etc. F1 exists because of the marketing value it creates. The rest is noise, including the engineering aspect of it.
Whatever the case, this is tragic and worrisome about Mclaren's future. Specially when things were looking so promising.
ajpennypacker
Posts: 2,475
I actually just read that Daniel will be taking a 60% paycut. Crazy. Wasn't expecting that.
calle.itw
Posts: 8,527
Isn't it kinda sad though that we don't expect a common sense move from a modern F1 driver? Yeah, paycuts such, but even with 60% off he is still among the more higher-paid workers at McLaren.
Pistonhead
Posts: 556
AJPP - is that a 60perc cut on his new McLaren salary, or his salary on join McL will be 60% less than he was on at Renault?
ajpennypacker
Posts: 2,475
60% down from Renault. Check out the story at planetf1. Dot com
siggy74
Posts: 194
Stuck on Furlough ;p One facing unemployment in the coming months :(
The factory wages will be comparative across the industry...
The simply fact is, more SKILLED people are out of work now...
The salary on all jobs will be cut 20-30% across the board... dont like it dont apply... Dont except it then redundant....
With Daniel he is not only a driver, but a marketing tool to sell Clothes... Tickets, and also with hopefully winning podiums drive up car sales...
The F1 team is a marketing expense to drive, the sale of Road cars :D