In the quiet yet relentless hum of Europe’s auto industry, a stark transformation is underway. Schaeffler AG, a longtime pillar in Germany’s machinery and auto-parts sector, recently announced plans to cut 4,700 jobs across Europe. The effects of this decision ripple through both factory floors and boardrooms alike, signaling a new era for a company that has long supplied parts for some of the world’s biggest automotive names, including Volkswagen. This wave of job cuts and plant closures exposes a stark truth: the struggles of the continent’s automotive giants now haunt their vast network of suppliers.
At the heart of this decision is what Schaeffler diplomatically calls “structural measures” to respond to Europe’s sluggish car production and its ailing industrial landscape. For a company that prides itself on precision and resilience, consolidating production, resizing operations, and shuttering two non-German factories marks a radical but necessary step. In total, 3,700 jobs will be eliminated after some relocations—a recalibration that will impact communities from Germany to smaller European sites.
Germany, with its historic roots in engineering excellence, will feel the brunt of these cuts. Some 2,800 positions across 10 sites in the country will be scrapped. Schaeffler, aiming to reduce costs by €290 million by 2029, is taking its cue from other major automotive players like Bosch and ZF Friedrichshafen AG, which have also enacted large-scale layoffs. These adjustments are painted as essential for staying competitive in a market that grows ever leaner and more unforgiving by the day.
The reaction on the Frankfurt stock exchange was tepid, with shares down nearly 2%. For Schaeffler, its earnings and investor confidence are now at a critical juncture. The company reported a 45% drop in quarterly earnings before interest and tax, underscoring the squeeze felt across the industry. As Europe’s powerhouse automotive sector recalibrates, this reshuffle may only be the first rumble of larger tectonic shifts poised to redefine the region’s industrial backbone.
(Source: EuroNews | Bloomberg)
