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China virus hits JCB

UPDATE: JCB announced today it is reverting to a basic working week of 39 hours at its UK factories.

CEO Graeme Macdonald said: “This is not a moment for celebration, but it is a step in the right direction. There has been some improvement in the shipment of components from China but new threats are emerging from our supply chain in other parts of the world, notably Italy and South Korea.

“We will continue to monitor the situation very closely on a daily basis and take any necessary measures to protect the business.”

(Updated 5/3/2020)

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JCB is slashing production at its UK factories as it reacts to anticipated component shortages from Chinese suppliers hit by the coronavirus crisis.

All overtime has been suspended and a shorter working week for around 4,000 JCB and agency shop floor employees will take effect on Monday.

The measures are being put in place following discussions with the GMB union and will see the introduction of a 34-hour week for UK production employees “until further notice”. JCB workers will be paid for a 39-hour week and will bank the hours, working them back later in the year.

Chief operating officer Mark Turner said the moves were “absolutely necessary to protect the business and our skill base”.

He added: “Production in the UK has so far been unaffected by the situation in China. However, more than 25% of JCB’s suppliers in China remain closed and those that have reopened are working at reduced capacity and are struggling to make shipments.

“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.”

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©Scottish Plant.  Article posted 13/2/2020. Updated 5/3/2020