Daimler to cut thousands more jobs in bid to reduce costs

Car manufacturer struggling with cost of electic vehicles

Daimler is to cut thousands more jobs worldwide in the next two years as it struggles to pay for the enormous costs of investing in electric vehicles.

The Mercedes-Benz owner had already announced that a tenth of managers would be axed, but will now let go of at least a thousand administrative staff too.

Assembly-line employees are not included in the latest figures. Daimler had previously agreed a jobs guarantee with workers’ representatives, which protects operational staff in Germany against compulsory redundancies until the end of 2029.

In a statement, Daimler said it would reduce its headcount in a “socially responsible manner”, and use “natural fluctuation to cut jobs that become vacant”.

The carmaker, which directly employs 130,000 people in Germany, added that voluntary redundancy packages will also be offered to those nearing retirement.

The company, which says it will cut €1.4 billion in personnel costs, will seek to make further savings by offering its current workforce the option of reducing weekly working hours.

“A reduction in capacity must not be carried out on the backs of employees,” warned Michael Brecht, chairman of Daimler’s works council.

The council added that “the focus of personnel cost reduction must be on the improvement of processes and workflows.”

Daimler’s latest announcement comes days after Audi announced it was cutting almost 10,000 jobs, and reducing the production capacity at two of its main factories. – Copyright The Financial Times Limited 2019