GKN ready to shed 1,250 jobs

AUTOMOTIVE and aerospace group GKN is to shed 1,250 jobs over the next year, most of them expected to be in Britain and the US. It will also take an £85m hit on earnings in the current year in addition to a £40m exceptional charge already announced.

The shares tumbled 20p, or 7%, to 260p on the news. The latest job losses will be at GKN's civil aerospace divisions on the Isle of Wight and in Portsmouth, with more going at its US aerospace and automotive component factories. The group expects demand in the civil aviation market to decline until 2003.

It announced a round of 500 job cuts, mainly at its automotive division in the US, earlier this year. Seventy jobs have also gone at its corporate headquarters in London and Redditch.

GKN believes that car and light vehicle production in the US and Europe will be down by 10% in 2002. Its military aircraft business is expected to be unaffected during the next few months.

Chief executive Marcus Beresford said today: 'These actions will ensure that GKN successfully weathers any further economic downturn and is well-placed to exploit the underlying strengths of our businesses and our balance sheet when the upturn comes.