Another large German company announces that it will dismiss thousands of people, a sign that the pressure is increasing on the automotive industry
The factory of ZF Friedrichshafen (source Jonathan Weiss, Dreamstime.com)
The ZF Friedrichshafen AG car component supplier dismisses 7,600 employees, as part of an extended cost reduction program. “We have to go over this,” said the general manager of the company who has 160,000 employees in the world.
The German car industry will eliminate almost 100,000 jobs by 2030, writes Bloomberg, and among companies that have announced large “cuts” are Bosch, Volkswagen, Continental, Audi, Schaeffler and Porsche.
ZF will eliminate 7,600 positions at the Division of Electrified Propulsion Systems, the main reason being the low demand for components.
The trade union management has approved the discounts that are part of a previously announced plan, a plan aimed at removing at most 14,000 employees in this decade.
Other saving measures at ZF Friedrichshafen include delaying wage increases and reducing the work schedule in Germany. The company estimates savings of over 500 million euros by 2027, as a result of these measures.
“We have to get over this,” said the general manager Mathias Miedreich, in a press conference. “It is a common effort to make our products more competitive at the cost level, but also to increase the income.”
The announcement shows that the pressures on the German auto industry that is affected by the weak demand in Europe, the customs tariffs and the increasing competition from China are intertwined.
The division at which redundancies are made is the largest of the company by the number of employees and sales figure. The division will stop the development of products for electric cars, directing investments to technologies such as plug-in hybrid systems.
The company analyzes the possibility of buying from other companies electric and inverters, instead of producing them alone internally.
Photo source: dreamstime.com
