ROLLS-Royce has announced plans to axe more than 2,500 jobs, mainly from the division which employs hundreds of people on Wearside.
The firm is cutting 2,600 posts over the next 18 months, principally from its Aerospace division, which operates the new plant on the former Dunlop Tyres site in Washington.
It is not clear how many jobs, if any, will be affected at Washington.
The firm this afternoon released a statement outlining the reasons for the move.
“The investment we have made in technology and new capacity, alongside the organisational changes we have made to simplify the group, have enabled us to increase output and improve efficiency.
“A large engineering team was required for the development phase of the Trent 1000 and Trent XWB engines. Both these major programmes have now entered their production phase, reducing our engineering requirement.
“We have opened a number of world class new facilities, such as Crosspointe in the USA and in the UK at Rotherham and Washington, Tyne & Wear. These set new standards in productivity and efficiency and allow us to improve the competitiveness of our footprint.
“The organisation of our Group into two divisions, Aerospace and Land & Sea, will enable us to reduce management layers and structural cost including indirect labour.”
The firm says the move will save around £80million a year.
CEO John Rishton said: “We are taking determined management action and accelerating our progress on cost. The measures announced today will not be the last, however they will contribute towards Rolls-Royce becoming a stronger and more profitable company.
“We will work closely with employees and their representatives to achieve the necessary reductions on a voluntary basis where possible, while making sure we retain the skills needed for the future.
“Our business remains well positioned in growth markets.”
Deputy Prime Minister Nick Clegg and Business Scretary Vince Cable visited Washington in June to open the new plant. Rolls-Royce shares the former Dunlop site with a new BAE Systems munitions factory.