Schaeffler to cut 4,700 jobs amid European industry struggles
The German corporation Schaeffler, one of the world's largest suppliers of machine and automotive parts, has announced job cuts across Europe, impacting 4,700 employees. The company, whose shares have fallen by 20% this year, aims to achieve savings of £250 million.
The German automotive industry has been facing significant challenges recently. Like the entire European sector, it is grappling with high production costs and the transition to electromobility. Declining demand and cheaper alternatives for consumers exacerbate the situation.
The difficulties faced by car manufacturers such as Volkswagen, BMW, and Mercedes have repercussions for parts suppliers. This is apparent in the case of the Schaeffler corporation, where shares have dropped by over 20% this year. Its European workforce will feel the consequences.
The company announced on Tuesday that it plans to cut 4,700 jobs across Europe between 2025 and 2027. Of these, most—2,800—will be in Germany. According to reports from Reuters, two plants in Europe are set to close, although the specific locations have not been disclosed.
Problems of Europe's largest economy
The company aims to save £250 million by the end of 2029 through these reductions. It is important to note that globally, the corporation will decrease its workforce by about 3,700 employees, with some positions relocating out of Europe.
Earlier reports in the media indicated that the issues faced by giants like Volkswagen—which plans to shut at least three factories in Germany and lay off tens of thousands of workers—will lead to reduced operations at other plants in the country.
The German Association of Counties and Municipalities recently warned that the crisis affecting VW could result in problems for rural areas.
“The current events at VW are not only a true shock for the entire business landscape in Germany,” stated the association's chairman Achim Brötel (CDU) to the Funke media group newspapers, “but also particularly for firms supplying the automotive industry, most of which are based in rural areas.”
