Major layoffs at Cosworth
Following the decision by the sport's governing body to freeze engine development as of next season, Cosworth UK decided to make up to 150 employees redundant at the end of the 2006 season according to autosport.
The company's commercial director Bernard Ferguson confirmed the news, although he said the exact magnitude of the redundancy program remains undetermined.
"We haven't finalized any numbers yet, but for sure we'll be reducing our workforce at the end of the race season," Ferguson told autosport.com.
"I think it's fair to say that it will be a significant percentage of our people, and it will be due to the change in the regulations.
"There's been a steady reduction in the demands for engines over the last two or three years. It used to be that an engine life was the span of a race, and now it has to run for two race weekends, so we need to produce fewer engines.
"The second impact comes now, as the development is more or less finished due to [the engine freeze] rules, and at least 50% of the engines that we produce are for development rather than to go racing.
"So the combined effect of those events means we have considerably less work to do than what we had in the past.
"That affects people at all levels – whether they're designing engines, or assembling. So unfortunately we got a fairly severe impact on our business."