UK-based ROV and trenching vehicle manufacturer Specialist Machine Developments (SMD) is to cut 80 jobs in the wake of its largest ever order being suspended due to Russian sanctions.
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Image from SMD Facebook. |
The order for two suites of cable laying and burial equipment has been suspended due to the rejection of an export license that was a result of current sanctions in place for Russia.
“This is a decision SMD will appeal, and the outcome will have a significant impact on the final redundancy numbers. SMD has continued to retain capacity in anticipation of this order but will be unable to continue to do this should the appeal fail, hence the need to progress to HR1 at this time,” SMD said.
HR1 is a 30-day consultation period required under UK law over redundancies.
SMD said it is suffering extremely challenging market conditions, and the decline in demand from the oil and gas market, driven by the prolonged reduction in the oil price, has caused many projects to be shelved until at least late 2016.
“We are very disappointed to be in this situation given the inevitable impact on our colleagues and partners in our supply chain. A number of our key markets are subject to challenges for a variety of largely unrelated issues and we need to react to these challenges in order to sustain the business for the future,” Andrew Hodgson, SMD CEO said. “We hope to demonstrate that the UK continues to be the center of our operations into the future.”
Earlier this year, SMD was acquired by China’s Zhuzhou CSR Times Electric Co. in a US$196.6 million deal.
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