Schaeffler will lay off 4,400 employees and close or sell three German factories!

On September 9, affected by the epidemic, parts supplier Schaeffler said that by the end of 2022, it will lay off 4,400 employees and close or sell many factories in Germany, aiming to further transform and enhance market competitiveness.
On the same day, Schaeffler stated in a statement that most of the layoffs will be concentrated in twelve factories in Germany and two other factories in Europe; Wuppertal, Eltmann and Clathal- Zellerfeld’s three plants will be shut down or sold to other companies, which is expected to save Schaeffler up to 300 million euros (about 354 million US dollars) each year. The company will spend 700 million euros (approximately US$826 million) for this restructuring.
Schaeffler CEO Klaus Rosenfeld said in an interview: “We are now in a situation where the terrible impact of the epidemic is reducing, but it will not return to the level of business in 2019 soon. It may not be until 2024. It will fully recover. This is not a V-shaped curve.”
In response, the leader of IG Metall, Germany’s largest trade union, said that it was unacceptable to close the Wuppertal factory. The union manager Clarissa Bader said in a statement: “We will not let Schaeffler close the plant easily.”
After the epidemic forced factories to shut down earlier this year, market demand for suppliers, including Schaeffler and Continental, has fallen sharply. Although German Chancellor Angela Merkel has always refused to provide more government assistance to the auto industry, the German government and auto industry leaders are currently holding talks to discuss ways to support enterprises, especially for auto suppliers. .
Continental announced last week that it will lay off 13% of its employees, which will affect 30,000 jobs. According to the Bloomberg Billionaires Index, among the wealthiest families in Europe this year, Schaeffler and Continental Tire’s two largest shareholders-Georg Schaeffler and his mother Maria Elisabeth Schaeffler-Thumann have shrunk the most.
Schaeffler announced last month that it would raise 1.3 billion euros (approximately US$1.5 billion) through the issuance of new shares to support its financial situation. The company has expanded its voluntary resignation plan to 1,900 positions in Europe. Rosenfeld said last month that the company is considering further layoffs based on the economic recovery. In the first half of 2020, Schaeffler’s operating income fell by more than 20% year-on-year, but still achieved a small profit.
German supplier Schaeffler mainly produces automobile engines, gearboxes and chassis parts. The company’s automotive business sales in 2019 were approximately US$10.1 billion, ranking 28th in the Automotive News Global Top 100 Parts Suppliers list.