JCB to reduce production due to expected shortages from China
JCB is set to reduce production levels at its factories due to anticipated component shortages from Chinese suppliers impacted by the coronavirus outbreak, the company announced today, Thursday, February 13.
The move will mean a shorter working week for around 4,000 JCB and agency shop floor employees from next Monday, February 17.
This follows an immediate suspension of all overtime, according to the agri machinery giant.
JCB employees will be paid for a 39-hour week and will bank the hours, working them back later in the year.
JCB chief operating officer Mark Turner said: “While this course of action is very unfortunate, it is absolutely necessary to protect the business and our skill base.
“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.
“It is therefore clear that the inbound supply of certain components from Chinese partners will be disrupted in the coming weeks as they seek to replenish their stocks.
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.
“We are keeping the situation under review and we anticipate a surge in production levels once this period of supply disruption has passed,” Turner concluded.