Published By : 19 Sep 2013 | Published By : QYRESEARCH
German specialty chemicals manufacturer Lanxess will further intensify its cost-cutting drive by axing 1,000 jobs by 2015 end. The company is taking these measures in a bid to counter the falling demand for its products and the resultant revenue loss. This, coupled with other cost-cutting measures is expected to help the company save 100 million euros or USD 134 million annually.
Lanxess\' current global employee headcount stands at 17,500. The company plans to cut jobs by implementing voluntary retirement schemes and by offering severance pay to employees whose services are no longer needed. The variable compensation payout will likely be curtailed for existing employees who are eligible for it. These policies will also apply to the management board.
With an increasingly competitive market and volatile raw material costs, the company recorded a falling demand for its synthetic rubber products and solutions. Besides cost-cutting measures, the company is also looking to optimize its product portfolio in keeping with shifting market demand trends.
While officials did not disclose global locations where jobs would be cut, sources said that in Germany alone, around 300 jobs would be cut. The group is heavily dependent on sales from the tire and automobile sector that constitute 40% of annual sales. With immediate prospects of the European automobile sector looking bleak, the demand for Lanxess\' product and services will remain weak.
In the meanwhile, company officials said that strategies are being chalked out to enter joint ventures or to sell certain activities.