Triumph Motorcycles has announced 240 UK job losses, as sales of big bikes take a big hit from the global lockdown.
Management at the Hinckley-based bike manufacturer also warned it might be hard to bounce back from the predicted global recession, post-virus.
Chief commercial officer Paul Stroud said sales of Triumph bikes never fully recovered from the Credit Crunch a decade ago as people held off on expensive “discretionary purchases” – and he expects a similar trend this time around.
Globally the business is laying off 400 people.
In a statement it said Covid-19 had “significantly reduced global demand for large capacity motorcycles”.
The business employs around 2,500 people around the world with 1,044 in the UK where a 45 day consultation period is now underway.
Between 6,000 to 7,000 of the 65,000-or so bikes it was making each year are produced in the UK. Even before the pandemic it was making big changes to production.
In February it warned of up to 50 jobs losses at its UK headquarters under plans to make Thailand its main centre of manufacturing.
Back then the business warned staff at its Hinckley production line of redundancies in manufacturing and IT. It said it was “realigning” operations as part of its global ambitions to double its share of the Asian market over three years – on top of a new partnership with Indian manufacturer Bajaj.
Hinckley will still make its prototype and bespoke models and will still become its global centre of research and development.
Staff were told of the latest job losses today.
The business, which was saved by the Bloor family of housebuilders in the 1980s, said: “The proposed restructure is expected to result in circa 400 redundancies from across its global workforce, including approximately 240 from its UK headquarters and operations.
“Sales in the larger 500cc plus motorcycle segment, in key markets such as France, Italy, Germany, the USA and the UK have fallen by between 40 and 65 per cent over the past three months during what would normally be the peak season for sales.
“Although Triumph sales have outperformed this significant decline to some degree, the market is forecast to remain considerably down on pre-Covid 19 levels as a direct result of the economic conditions created by it.”
It said the drastic steps would help it lay the “foundations for future global growth in the decades to come”.
Triumph Motorcycles chief executive Nick Bloor said: “These are not only challenging times for everyone as individuals, but also for the company.
“No business could have anticipated the scale of the coronavirus crisis and its economic consequences.
“The pandemic has caused significant damage to the global motorcycle market, and, sadly, we have to respond and react accordingly as both a responsible employer and as a business that invests for the future.
“These are not easy decisions to make, especially when individuals’ livelihoods are affected; however regrettably the scale of impact of Covid 19 necessitates us to restructure now in order to protect the long term health and success of the Triumph brand and business.”
Triumph is the UK’s biggest bike manufacturer, and employs around 2,000 people.
Turnover grew to £529.5 million in the year to last June, when it made 60,131 bikes.
Pre-tax profits rose from £9 million to £9.5 million, while the amount spent developing new models rose from £36 million to £43.4 million.
Originally launched in the West Midlands in 1902, for the past three decades Triumph has been based in Hinckley, and now has factories in Thailand and assembly operations in Brazil and India.
Its current ranges include the Rocket R and GT, the new higher performance Thruxton RS and Street Triple 765 RS, the Scrambler 1200, and Triumph Bonneville.
It has subsidiary operations in North America, France, Germany, Spain, Italy, Japan, Sweden, Benelux, Brazil, India, Thailand, and China.
