Rolls-Royce Moves Operations to High-Wage Paying Countries
- Posted on October 24, 2011 at 5:30pm by
Becket Adams
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Here is a different business strategy for major manufacturing companies: pursue operations expansions in high-wage paying countries. Sound like an idea that defies convention? Maybe. But it’s the strategy that British manufacturing giant Rolls-Royce had adopted.
Setting itself apart from almost all of its competition (specifically General Electric), Rolls-Royce has decided against shifting production to low-wage areas in Asia and Latin America, reports the Wall Street Journal.
Instead, the Rolls-Royce strategy involves expanding into countries with healthy economies such as Germany, Norway, and Singapore (“where salaries dwarf those around the region”).
“If you want to do complicated, high-value engineering, you’ve got to have a good supply of skilled people and support from governments,” Rolls-Royce CEO John Rishton said in a recent Journal report.
But even with generous pay, Rolls faces a shrinking pool of engineering talent that’s being lured into finance and computers, writes Newser. Balancing skills and cost “is walking a tightrope,” Rishton says. “We wrestle with those issues all the time.”
In order to attract these “skilled people,” Rolls is training hundreds of apprentices annually and has collaborated with 28 universities worldwide. It is also opening far-flung facilities, such as a new factory in Singapore, where Rolls for years has maintained jet engines, writes the Journal.
The point of this new strategy?
Rolls-Royce wants to aggressively compete in the market by matching their brains against the brawn of the lower-cost competition, writes the Journal.
So far, the gamble is paying off. Rolls-Royce saw revenue spike 55 percent over the last 5 years and gained a net profit of $1.3 billion over the first half of 2011, reports Newser.
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BobtheMoron
Posted on October 25, 2011 at 6:25pmBrian ain’t too bright. Rolls Royce won’t be hiring him. The cars, by the way, are very good and very nice.
Report Post »kalayaan
Posted on October 25, 2011 at 2:11pmThis is really true…most of the time the best and the brainiest gets the most pay…I was a Supervisor a long time ago…I only hire people that could make my work better and easier…and I was willing to pay a good rate…they were happy and I was happier…
Report Post »tomahawk85
Posted on October 25, 2011 at 1:13pmThe students that graduate from American Colleges and Universities can’t even answer a SIMPLE question like, “Name a country that borders on the USA.” Uhhhh, Hmmmm Uhh let me see Europe? (WTF) any doubts just watch Jay Leno during his Ask the Public segment. These stupid A$$’s embarrass the “$” out of me and I am ashamed of what these colleges put into society. All the Teachers / Professors give a rats A$$ about is their Tenure. Leave no child behind? WTF? R U kidding me, that train has left the stations over 50 years ago (just prior to the Hippy Dippy scene came upon the USA). America is and has been on the decline and there is no saving it in my personal opinion. I see NO hope. Its only going to be time before a Nuke goes off on our soil…then watch the “UGLY AMERICAN” come out of the closet, food riots, gas riots, anarchy this will be the norm…Dont ever say I didn’t warn you. You better have at a minimum a years supply of food, plenty of water, and of course Guns and ammo to protect your family…. Thats the only thing that will matter is your family!!!!
Report Post »Hickory
Posted on October 25, 2011 at 9:19amWe keep hearing about students getting loans to graduate with degrees in stupidity. This has to stop. If we are serious about getting more engineers and technicians into the workplace, we need to have something like the old GI Bill for courses of study for those positions. As a retired engineer, I can tell you these courses of study are not cheap. We have many capable young people who would jump at the chance to go to school and become engineers if they got the opportunity. Cooperation between government and companies worked back when and it can work now. In my day as an engineer, my employers had summer jobs for engineering students. We were able to select the cream of this crop and hire some excellent engineers when they graduated. Many of these people, including me, designed a lot of the functions in the Apollo missions. We can do it again.
Report Post »Ruler4You
Posted on October 25, 2011 at 12:27pmThis is what we have built. We constructed this. This has been our destination. It didn’t “just happen.” The complaints, over the years, that schools were going the wrong direction? well, they were. Here, we have the final proof. Not that we couldn’t have seen it here, as the jobs left this country at light speed, but we have been too occupied with our own survival to pay attention more than just sounding the warning. Well, no one has listened and now we find ourselves in the bad place we knew we would end up if we didn’t change course. Well?
Report Post »Walkabout
Posted on October 25, 2011 at 7:39pmI wish Gallup or Schoen would take poll of the OWS protesters who recently graduated to see what % took what majors.
Report Post »cmaczko
Posted on October 25, 2011 at 8:03amunplugged and moving forward. Thank You Rolls for giving us some ideas. Lord, make us all John Gault!!!
Report Post »Tightroper2
Posted on October 25, 2011 at 8:00amObamamama – Hey guys
– come to the U.S. I’ve added another seven states. More on the way. Guaranteed!
Report Post »Sheepdog911
Posted on October 25, 2011 at 5:59am“If you want to do complicated, high-value engineering, you’ve got to have a good supply of skilled people and support from governments,” This statement certainly rules the U.S. out of the equation.
Report Post »stpppim
Posted on October 25, 2011 at 9:16amCheck your premises. Go back to the beginning and make sure you are basing your conclusions on the correct basic idea or assumption.
Report Post »OhioRifleman
Posted on October 25, 2011 at 5:56pm@ STPPIM
His statement stands as valid. The Federal government is attempting to strip our nation down to second-world or third-world status, which is not the environment Rolls-Royce is looking for.
Personally, I would love to see them here in America, but right now America is busy disassembling itself courtesy of the past few marxists we have had in office. They are smarter than that.
Report Post »buh-bye libs
Posted on October 25, 2011 at 5:57am@BRIAN8793……….
Unplug your keyboard……you have no need to replying to a post you don’t understand.
Shakin’ my head in disbelief……..
Rolls Royce is talking about high tech jet engines….hence the picture of the engine next to the story.
Report Post »onebigassmistakeamerica
Posted on October 25, 2011 at 3:13amPlease America, do yourselves a favor and vote for anyone BUT Obama.
Report Post »pamela kay
Posted on October 25, 2011 at 3:59amDon’t forget to add Hillary to the list in case she gets the nomination instead.
Report Post »Robinchews
Posted on October 25, 2011 at 3:05amI hope he stays safe, & blessings to him speaking his mind. Yes! Straight Up!
Report Post »SaskBrad
Posted on October 25, 2011 at 1:01amI think this Rolls Royce is the £10B company that makes big engines, like those on the Boeing 787 or nuclear reactors for submarines. The subs get great mileage. The motorcar division and this company split in 1973.
Report Post »brian8793
Posted on October 25, 2011 at 12:38amIf I was English I might care about this. I would never buy a Rolls Royce car. Not only are they over priced, but they are gas guzzlers.
I’m still sad that “Saab” closed down. Now that right there is a fine automobile ; )
Report Post »Walkabout
Posted on October 25, 2011 at 7:35pmRolls-Royce Motor Cars is a British manufacturer of luxury automobiles based at the Goodwood plant in West Sussex, England. It is the current producer of Rolls-Royce branded automobiles, whose historical production dates back to 1904. The factory is located across from the historic Goodwood Circuit in Goodwood, West Sussex, England. It is a wholly owned subsidiary of BMW.
Rolls-Royce Group plc (LSE: RR.) is a global power systems company headquartered in the City of Westminster, London, United Kingdom.[3] It is the world’s second-largest maker of aircraft engines (behind General Electric),[4][5] and also has major businesses in the marine propulsion and energy sectors.
In 1971, Rolls-Royce was crippled by the costs of developing the advanced RB211 jet engine, resulting in the nationalisation of the company as Rolls-Royce (1971) Limited. In 1973, the car division was separated from the parent company as Rolls-Royce Motors.
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