Schaeffler Group to Make 250 million euros of Savings

Schaeffler Group has announced that is to implement further cost adjustments, while trying to prevent layoffs. In the first quarter of 2009, the company’s Automotive division recorded a downturn of 33 per cent compared to the previous year, which has now stabilized at a level 25 per cent below last year’s. The Schaeffler Group’s Industrial division, which accounts for 40 percent of total sales, sustained losses of 12 per cent in the first quarter. At 7.5 billion euros, current sales expectations for 2009 are significantly below 2008 levels. In a statement the company said it does not expect the markets to return to 2008 levels until 2012 or 2013.

Due to lost sales, the group has to achieve annual labour cost savings of 250 million euros in Germany. “If we were to reach this goal through layoffs alone, it would correspond to roughly 4,500 jobs. However, we have made it clear from the start that we want to prevent layoffs wherever possible. That is why we have focused on a number of other measures to reduce labour costs in Germany and save as many jobs as possible,” said Dr. Jürgen M. Geißinger, president and CEO of the Schaeffler Group.

While the Schaeffler Group has already cut 5,000 jobs in other countries, labour cost reductions in Germany so far have been achieved using short time, natural employee turnover and the termination of fixed-term and temporary employment contracts.