Degussa to cut more jobs in Germany as China business grows

09 March 2004 18:09  [Source: ICIS news]

DUSSELDORF, Germany (CNI)--Degussa plans further reductions in its workforce up to 2007 with the focus on Germany, the company indicated on Tuesday.

The jobs will be lost as part of an ongoing restructuring and cost-saving scheme, which resulted in the elimination of a total of 4800 postions worldwide in 2000-03.

Chairman Utz-Hellmuth Felcht said here today at the company's 2003 financial results press conference that the cutbacks will take place “overproportionately in Germany, because this is where the major part of our production facilities are located.”  He gave no indication of the number of jobs that could be lost although he added that in reducing employment Degussa will push early retirement schemes even more than previously.

Talks with employees are in progress about restructuring measures at German sites, including fine chemicals production at Lulsdorf and in the high performance products unit, mostly at Marl, where annual sales total Euro243m ($301m).

Managing board member Thomas Schoeneberg told CNI that some 300 employees at the two sites will be affected by the measures, which could include reduction of working hours and pay, along with the phase-out of profit sharing schemes.

Similar measures were undertaken last year in the Goldschmidt industrial chemicals segment at Mannheim and at building chemicals producer Relius in Oldenburg.
 
In high performance polymers, price pressure - especially from China - has negatively affected the telecommunications supply sector, where Degussa manufactures speciality polybutylene terephthalate (PBT) for fibre optic applications. This, coupled with higher feedstock costs, has led to the mothballing of some production capacity.

On a brighter note, board member Alfred Oberholz told CNI that business in polyamide 12 and related polymers, also part of the high performance polymers unit, is progressing well.

Because of the boom in demand from China for such polyamide 12 applications as fuel hoses, air brake systems for trucks and shoe soles for professional sport shoes, Oberholz said Degussa will consider adding new capacities in China. A decision is to be taken “in one to two years.”

By: Dede Williams
+44 20 8652 3214

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