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Mon May 25 2020

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JCB production hit by coronavirus

14 Feb With Chinese suppliers grinding to a halt, British digger maker JCB has been forced to cut its production output.

JCB is being forced to slow production
JCB is being forced to slow production

More than a quarter of JCB’s suppliers in China have had to close their doors because of the coronavirus outbreak.

While JCB has not yet had any shipments of components fail to arrive, it is anticipating this happening in the coming weeks.

The company is therefore introducing a shorter working week for around 4,000 JCB and agency shop floor employees from Monday 17th February. This follows an immediate suspension of all overtime.

The measures have been discussed with the GMB union and will see the introduction of a 34-hour week for UK production employees until further notice. JCB employees will be paid for a 39-hour week and will bank the hours, working them back later in the year.

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JCB chief operating officer Mark Turner said: “The disruption to the component supply chain in the UK comes at a time when demand for JCB products is very strong, so while this course of action is very unfortunate, it is absolutely necessary to protect the business and our skill base.

“Production in the UK has so far been unaffected by the situation in China. However, more than 25 per cent 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.”

Mr Turner added: “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.”

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