Thyssenkrupp to cut another 5,000 jobs as losses deepen

Europe

FRANKFURT — German supplier Thyssenkrupp plans to cut another 5,000 jobs to stem losses across its sprawling empire after posting a 1.6 billion euro ($1.9 billion) operating loss in its latest financial year, the company said in a statement on Thursday.

The company said it expected to make a decision about what to do with its struggling steelmaking business in the spring of next year after the division swung to a loss of nearly a billion euros as the global slowdown from COVID-19 lockdowns hit demand.

“We’re not yet where we need to be. The next steps could be more painful than the previous ones. But we will have to take them,” CEO Martina Merz said in the statement.

Thyssenkrupp said its adjusted operating loss would narrow in the year through September 2021 to the low hundreds of millions of euros though it would still have negative cash flow from ongoing businesses of about 1.5 billion euros.

The new job cuts come on top of 6,000 layoffs announced last year, moves that have angered powerful labor representatives on the company’s board.

“We reject sweeping, group-wide reduction programs. For us, it’s about preventing forced layoffs and maintaining as many sites and jobs as possible,” said Juergen Kerner, chief treasurer of Germany’s biggest union, IG Metall, and Thyssenkrupp’s deputy supervisory board chairman.

Thyssenkrupp, which also makes ships, car parts and trades in industrial materials, has already shed 3,600 jobs since announcing the first cuts last year.

That means another 7,400 will have to go over the next three years from a total workforce of 104,000.

To help fund its restructuring efforts and cut debt, Thyssenkrupp sold its elevators business to private equity companies last year for more than 17 billion euros. Despite this, Merz said in October that the company was still in a difficult situation.

The company tried to set up a joint venture for its steel business with India’s Tata Steel, but it was blocked by Brussels on antitrust grounds last year.

Thyssenkrupp, which has also held talks with Swedish steelmaker SSAB, is currently reviewing a non-binding indicative offer from Britain’s Liberty Steel.

Thyssenkrupp ranks No. 21 on the Automotive News Europe list of the top 100 global suppliers with worldwide sales to automakers of $11.86 billion during its 2019 fiscal year.

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