British digger maker JCB has been forced cut working hours and has suspended overtime for UK employees due to a shortage in parts coming from China, where the coronavirus is causing short-term disruption to the supply chain.
The shortage is a significant blow for the manufacturer, which sources hundreds of components from China, including electronic parts and castings, which are used to build its construction and agricultural vehicles.
More than 25 per cent of JCB’s suppliers in China remain closed. Those that have reopened are working at reduced capacity and are struggling to make shipments, according to JCB chief operating officer Mark Turner, who called the decision to cut production ‘very unfortunate’ but ‘absolutely necessary’ in order to protect the business.
The firm is planning to reduce working hours from 39 hours to 34 hours from next week, a move which will affect 4,000 of its employees. The majority of employees being affected are based in Staffordshire factories, including its Rocester headquarters, as well as plants in Wrexham and Derbyshire.
JCB chief operating officer, Mark Turner called the decision ‘very unfortunate’, but ‘absolutely necessary’ to protect the business and skill base.
“inbound supply of certain components from Chinese partners will be disrupted in the coming weeks as they seek to replenish their stocks,” Turner explained, adding: “This inevitably means we will not have the required amount of parts needed to build our forecast number of machines in the short-term.
“These measures will ensure that, while we will produce machines in lower than anticipated numbers, we will do so with the same number of employees, whose skills we will need to fulfil customers’ orders when the situation returns to normal.”
JCB is the first major UK manufacturer forced to cut its output because of the coronavirus, which is now officially named Covid-19 and has claimed the lives of more than 1,380 people worldwide, with a further 65,000 thought to be infected.