McLaren to slash 1,200 staff as coronavirus and Formula 1 halt bite

Supercar and Formula 1 racing business McLaren has become the first British automaker to unveil coronavirus job cuts after announcing more than a quarter of its workforce will be axed.

The Woking-based company is to slash 1,200 jobs as it reels from the impact of Covid-19. McLaren has been particularly hard hit because the pandemic has halted the Formula 1 racing season, which accounts for a large chunk of its earnings.

A spending cap introduced by Formula 1's ruling body has also contributed to the job losses, the company said.

McLaren said redundancies will be spread across its automotive, racing and technology arms, with back-office and support staff also affected.

The restructuring comes after it emerged that the privately owned business had asked the Government for a £150m loan to help it get through the crisis.

The bailout was turned down, with the business told it had not exhausted all alternative forms of financial support.

McLaren said it has been severely affected by the pandemic.

It added: "The cancellation of motorsport, the suspension of manufacturing and retail activities around the world and reduced demand for technology solutions have all led to a sudden reduced impact on revenue-generating activities.”

Paul Walsh, the recently appointed executive chairman, said McLaren had worked hard to avoid job cuts and has already slashed costs in other areas.

He added: “We deeply regret the impact that this restructure will have but we now have no other choice but to reduce the size of our workforce.”

Mr Walsh added that McLaren intends to emerge from the crisis as an efficient company with a clear path back to growth.