British luxury carmaker Rolls-Royce is currently going through some difficult times, as Chief Executive Officer Warren East announced multiple senior managers that they will stop collaborating with the company. Between those affected by the decision is the head of the engine maker’s aerospace and marine unites, Tony Wood, states Bloomberg.
Rolls-Royce will split into five units, each one reporting directly to Warren East, in an attempt to make a wholesale reorganization and cost-cutting program. Everything will last until February, said the company, who is also a turbines supplier for Boeing Co. and Airbus Group SE, in a statement released this Wednesday.
Tony Wood has been leading Rolls-Royce‘s aerospace division for two and a half years and was also linked as the next CEO, but he will eventually leave the company at the beginning of 2016. His position will be occupied by Eric Schulz, previously at the lead of the commercial large-engine department.
The whole purpose of the shake-up is to help Warren East gain control of the company, whose market value fell by $3.8 billion on November 12, as the stock tumbled 20 percent.
It seems that the Rolls-Royce management is looking forward to “simplifying organization, add pace and drive operational excellence.” Besides Mr. Wood, Lawrie Haynes, president of the land and sea unit, will also retire, so the top-level restructuring affecting a dozen positions. Still, not all the managers will leave, the company said.
Through this program, Warren East is seeking to save around 150 million pounds from the company’s costs. Last month, he declared that Rolls-Royce had been to slow to adapt to the changing market conditions, including a collapse in engine sales for vessels used by the offshore oil industry, a low demand for jet engines and finally, the retirement of some bigger planes, replaced by newer models.