McLaren will lay-off 1200 of its staff across its automotive, technological and racing divisions, the company announced on Tuesday.
Following from reports two weeks ago that the company was attempting to raise funds amidst financial difficulties due to the COVID-19 pandemic, the company has now combined those measures with extensive cost-cuts.
Per a report from motorsport.com, only 70 of the 1200 staffers cut are from McLaren’s Formula 1 division.
“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,” said Paul Walsh, executive chairman of the McLaren Group. “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.”
Potentially easing the blow of its lost personnel for McLaren will be last week’s approval of a significant reduction on the incoming budget cap for the 2021 F1 season, with the figure down from its original $175 million to $145 million.
Having been vocal proponents of such measures, Walsh reiterated McLaren’s stance that such financial tightening is beneficial for both the team and the sport’s long-term future.
“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,” Walsh said.
“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.”