The McLaren Group is set to part ways with 1200 members of its staff from both its automotive and racing segments as part of a major restructuring effort amid the coronavirus crisis.
The global economic downturn is taking its toll on the automotive sector, forcing manufacturers to initiate contingency plans to mitigate the financial impact of the crisis.
McLaren furloughed in April a portion of its F1 staff as part of the Coronavirus Job Retention Scheme, while the group is seeking to raise £275 million of capital to help weather the current storm.
Reports indicate that 70 workers will be cut from McLaren's F1 operation with the bulk of the layoffs coming from the automotive entity. Overall, the group employs around 4,000 people, the vast majority in the UK at its Woking McLaren Technology Center.
"We deeply regret the impact that this restructure will have on all our people, but especially those whose jobs may be affected," said McLaren Group executive chairman Paul Walsh.
"It is a course of action we have worked hard to avoid, having already undertaken dramatic cost-saving measures across all areas of the business. But we now have no other choice but to reduce the size of our workforce.
"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."
Formula 1 will introduce in 2021 a $145 million budget cap, with a sliding scale reduction that will occur in the following seasons, a move that will hopefully help alleviate the financial concerns of the sport's midfield teams.
"McLaren Racing has been a proponent of the introduction in 2021 of the new Formula 1 budget cap which will create a sustainable financial basis for the teams and lead to a more competitive sport," added Walsh.
"While this will have a significant impact on the shape and size of our F1 team, we will now begin to take the necessary measures to be ready to run at the cap from 2021 onwards, in order to challenge again for race wins and championships in the future."
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