McLaren is to lay off 1200 of staff members across its organisation in order to conserve costs amid the ongoing economic crisis caused by the coronavirus pandemic.
The number of people made redundant will add up to 25% of McLaren's entire workforce and the cuts will be spread across its Formula 1 team, its road car division and Applied Technologies.
Last month, McLaren announced that it had placed some of its F1 staff on furlough as part of the Coronavirus Job Retention Scheme.
The budget cap will exclude all marketing expenses, race driver payments and the charges of the team’s three highest-paid personnel.
Paul Walsh, the McLaren Group's executive chairman stated: “We deeply regret the impact that this restructure will have on all our people, but especially those whose jobs may be affected.
“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.”
Earlier this month, it was reported that McLaren was looking to mortgage the McLaren Technology Centre in Woking and its classic cars in order to raise £275 million.
More teams are likely to lay off staff as the budget cap looms, however Ferrari has confirmed that it is looking at a potential IndyCar entry which would allow it to keep members of the team employed but place them in a different racing series.
McLaren has picked up more sponsors over the last couple of years and enjoyed a strong 2019 season, finishing fourth in the constructors' championship - its highest finishing position since 2012.
A majority of the McLaren Group's sales stems from its road car division, while its racing activities pull in roughly 20% of its revenue.
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