German company Schaeffler Group has announced plans to cut approximately 4,700 jobs in Europe and close two factories. This decision comes in response to declining sales in the European automotive sector. The cuts are part of a larger effort to save around €290 million annually by the end of 2029.
In Germany alone, around 2,800 jobs will be affected across ten locations. The broader automotive industry's sluggish performance, which has prompted major players like Volkswagen, Mercedes-Benz, and BMW to reconsider their transition to electric vehicles, has significantly impacted Schaeffler and other German component manufacturers. This downturn resulted in a 45% drop in Schaeffler's adjusted earnings before interest and taxes in the third quarter, down to €187 million.
While some roles will be relocated, reducing the net number of job cuts to 3,700, this still represents about 3.1% of Schaeffler's total workforce. Schaeffler maintains its profit margin forecast between 5% and 8% despite these challenges.
