ZF supplier drops every fourth place in Germany
The automotive supplier ZF will significantly restructure its German production network. The company announced that German sites will be made more efficient and consolidated into multiple location clusters. The workforce in Germany is expected to shrink from currently around 54,000 employees to between 43,000 and 49,000 by 2028.
Investments in the areas of Commercial Vehicle Technology, Chassis Solutions, Industrial Technology, and Aftermarket will further strengthen ZF. However, a particular focus is on the division of Electrified Powertrain Technologies due to intense competition and cost pressure, as well as weak market development for electric vehicles.
"The seriousness of the situation requires resolute action to adapt the company to the challenging market and competition environment and meet the trustee's mandate for securing the future," said CEO Holger Klein. "We want to further strengthen ZF's robust core. That's why we're working on a more agile company setup to react better to rapid market changes."
The workforce reduction will be "as socially responsible as possible," using the demographic structure of the workforce and fluctuation, such as through retirement offers and possible severance programs.
Individual sites may be closed if no long-term perspective can be found for them or their competitive strength cannot be permanently improved, according to ZF.
The restructuring of ZF's automobile industry operations might have significant implications for the German economy, potentially affecting related industries and jobs. The dismantling of less efficient production sites is part of ZF's strategy to become more agile and responsive to market changes.
