Thyssenkrupp's Steel Division Overhaul and Job Cuts: A New Chapter Ahead
Thyssenkrupp's steel division intends to implement a social plan, while maintaining its stance on workforce reductions. - Thyssenkrupp Announces Social Plan for Steel Sector and Remains Committed to Job Reduction Strategy
'11,000 jobs on the line,' Schulte declared to the WAZ. He defended the move, stating underutilized plants operating 24/7 and exorbitant production costs compared to other steel producers. "We gotta make some changes," Schulte added, announcing a total of 5,000 job cuts and 6,000 outsourced positions.
The steel giant's main priority is getting displaced workers into new jobs, according to Schulte. Negotiations with the IG Metall union are imminent.
Earlier in May, the union and Thyssenkrupp reached a tentative agreement following a bitter standoff, laying the groundwork for ongoing discussions. The ambitious goal is a collective bargaining agreement safeguarding employment, locations, and investments for the green transformation. Operational dismissals were meant to be avoided[1].
Thyssenkrupp's steel division has faced turmoil for years, pushing the company to sell the subsidiary. The EP Group, led by the entrepreneur Daniel Kretinsky, has already bought a 20% stake in Thyssenkrupp Steel, with another 30% on the horizon[2].
Insights:
- Reorganization and Job Cuts: The steel division restructuring comes at a significant cost to the workforce, with Thyssenkrupp aiming to make the business more dynamic and attractive for investors[2].
- Joint Venture with EP Corporate Group: Thyssenkrupp's plan to transform Thyssenkrupp Steel Europe into a 50-50 joint venture with EPCG will help adjust the division's financial health and competitiveness[3].
- Focus on Future Prospects: The realignment targets offering employees a clear path forward by establishing favorable growth conditions for the segments[4].
Potential Impact:
- Job Cuts: Concerns over job losses persist despite efforts to minimise compulsory redundancies. Reportedly, administrative roles will face significant reductions[3].
- Long-term Prospects: IG Metall is advocating for a vision that guarantees job security and future prospects for both employees and sites[2].
- Market Position: A stronger market position could result from increased independence and investor appeal, potentially securing job security through enhanced competitiveness and investment opportunities[4].
In essence, while Thyssenkrupp endeavors to maintain job security, the steel division reorganization remains uncertain and risky for many employees.
The reorganization of Thyssenkrupp Steel Division, as part of its joint venture with the EP Corporate Group, may involve extensive vocational training programs to prepare workers for new opportunities within the manufacturing industry and potentially external businesses or finance-related sectors. The community policy being developed in negotiations with IG Metall aims to safeguard job security, locations, and investments, contributing to the green transformation and offering a competitive edge in the steel industry.
