McLaren set to slash 1,200 jobs as coronavirus realities bite

McLaren is set to announce it will slash its workforce by more than a quarter in reaction to the withering effects of the coronavirus crisis.

The British sportscar manufacturer and Formula 1 team currently employs 4,000 people but up to 1,200 of those will be made redundant, with the majority of job losses occurring in the UK.

As with all car manufacturers, the impact of the coronavirus – which has interrupted production and driven down sales across the market – is now beginning to be felt keenly, with McLaren expected to be just the first of a number of brands to announce a downsizing effort to reduce costs.

As well as being unable to shift cars, McLaren’s Formula 1 team has been grounded by the suspension to all racing activity until July at the earliest.

According to McLaren chairman Paul Walsh, efforts have been made to avoid making any significant layoffs but conceded the crisis has been particularly bad for the company.

“But we now have no other choice but to reduce the size of our workforce," he said in a statement.

"This is undoubtedly a challenging time for our company, and particularly our people, but we plan to emerge as an efficient, sustainable business with a clear course for returning to growth."

The job losses will affect all segments of McLaren’s operations, with the BBC reporting around 70 people will be cut from its 800-strong F1 workforce.

However, more are expected to follow as F1 instigates a $145 million budget cap from 2021, with teams admitting the slashing of costs will force it to reduce its employee sizes.

Ironically, McLaren has been particularly in favour of the budget cap with team boss Zak Brown campaigning for it to be as low as $100 million.