Thyssenkrupp’s steel division has announced plans to reduce its workforce by approximately 40% in the coming years, marking the latest significant restructuring effort by the German industrial giant. Workers have opposed the move strongly.
Germany’s largest steelmaker, a division of Thyssenkrupp AG, is also facing competition from Asian companies that were not competitors earlier, with high power prices along with a weakening economy, resulting in operating losses in four out of five past years.
With the restructuring, Thyssenkrupp Steel Europe (TKSE) will cut down 11,000 jobs from its workforce of 27,000, where 5,000 of which will be axed by 2030.
They are targeting to reduce personnel costs by an average of 10% in the coming years.
“Urgent measures are required to improve Thyssenkrupp Steel’s own productivity and operating efficiency and to achieve a competitive cost level,” the company said in a statement reported by Reuters.
Thyssenkrupp Steel has expressed plans to divest its stake in another plant located in Duisburg. However, if a sale proves unattainable, the company has indicated it will talk with other shareholders to discuss potential closure scenarios.
To align with “future market expectations,” TKSE aims to reduce its production capacity from 11.5 million metric tons annually to a range of 8.7 to 9 million tons.