ThyssenKrupp announced that the dramatic slump of the world economy since autumn 2008 has hit the business of ThyssenKrupp Steel AG very hard and the company has reacted to this by taking immediate actions.
It said that “In a first step, a cost cutting scheme has been established involving a one off saving potential for administrative and material costs of way over EUR 400 million. After the employees had been requested to bring their overtime accounts into balance and take remaining vacation days, it was decided last December to introduce short-time work as from January, affecting more than 15,000 employees in the current fiscal year. Moreover, blast furnace 9 was shut down in March on account of a drastic decline in incoming orders.’
The release said that “In a second step, the Program 20/10 was developed, aimed at improving structures and securing results involving cost cuts of more than EUR 300 million at ThyssenKrupp Steel AG and a further EUR 100 million at the subsidiaries. The ten “20/10” initiatives, among them two modules to curtail labor costs in administration and production in a range of up to EUR 150 million, are supposed to produce full effect on the results as from fiscal year 2010/2011.”
It added that “Within the framework of “20/10”, ThyssenKrupp Steel AG’s executive board and works council have now initialed a conciliation of interest scheme as well as a social compensation plan providing the reduction of 1,800 to 2,000 regular jobs by September 30th 2010.”
Mr Dieter Kroll, HR director on ThyssenKrupp Steel AG’s executive board said that “We stick to the clearly defined objective to avoid redundancies for operational reasons and the same goes for plant shutdowns in this period underlines. A whole bunch of socially balanced measures has been agreed upon, ranging from voluntary departure with severance payments, through the placement of employees in the internal job market, the offer of transfer measures called “work in work”, regulations on socially balanced departure of employees approaching the age of retirement, down to the intensified use of in sourcing. Moreover ThyssenKrupp Steel sees another way of facing the crisis in offering more than 80 apprentices to work part-time (28 hours per week) over two years.”
The release also said that “Furthermore, it was agreed that the program “ProZukunft“ of 2006 will be continued. This program provides to take 1,000 finished apprentices onto the workforce by the year 2013, 600 of whom have already been retained so far. After this summer, 329 young people will begin apprenticeships at ThyssenKrupp Steel.
Mr Kroll added that “We stick to all contracts and shall continue to offer training on the attained high level.”
ThyssenKrupp employs more than 40,000 people worldwide. More than 15,000 workers are already on short-time work schemes but that has not been enough to compensate for surplus capacity at the group.
