Telecommunications giant Vodafone has announced 500 job cuts as part of a ?1 billion cost-cutting package - but it is unclear if the losses will affect in any way the company's title sponsorship of the McLaren-Mercedes Formula 1 team.

The redundancies amount to five per cent of Vodafone's 10,000-strong UK workforce, as the mobile phone operator endeavours to achieve its savings targets by March, 2011. The Newbury-based organisation is the world's largest mobile phone company in terms of income, but since the global credit crunch late last year has been battling against the escalating cost of raw materials, falling handset sales and increasing competition from its rivals.

More than a third of the losses will be made at Vodafone's Berkshire HQ, in back-office roles, but all of the company's UK operations will be affected, the BBC reports. Only recently, the group released revenue figures of ?10.47 billion for the final quarter of 2008, up 14.3 per cent on the same period the previous year.

"Vodafone UK has today announced reductions to its operating costs in order for it to compete more effectively in the UK market," a statement read.

"As customers look for best value in their mobile services, Vodafone intends to reduce its cost base whilst continuing to invest in new products and services to meet changing customer needs."

F1 has already been hit in 2009 by the announced withdrawal of chief Renault backer ING, the departure of long-time BMW-Sauber sponsor Credit Suisse and the potential loss of significant Williams supporter the Royal Bank of Scotland amongst others.

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