17 March 2004 15:10 [Source: ICIS news]
LUDWIGSHAFEN, Germany (CNI)--BASF confirmed on Wednesday it was targetting Euro450m ($548m) of cost savings at its main production site, in Ludwigshafen, by mid-2005.
The German chemicals giant said so far it has implemented measures to save Euro200m and added that more than 20 000 individual cost control projects were underway.
In its 2003 financial results, BASF's earnings before interest and tax (EBIT) included special charges of Euro156m for the Ludwigshafen project. Adding restructuring costs in the Nafta (North American Free Trade Area) operations, the special charges totalled Euro305m.
A plan for more job cuts in North America was also disclosed today. BASF intends to axe an additional 750 jobs in the second phase of its restructuring programme for the region, which is foresees reducing fixed costs by $150m annually - with half the target being achieved this year. By the end of this year, the firm's first phase of restructuring is expected to give $100m savings. In total, the cuts in North America should lead to a reduction in group fixed costs of $250m by 2006.
BASF's Europe-wide reorganisation – the Europe II project - is also making progress, the group said today. However, details were not disclosed. The project is expected to deliver annual cost savings of Euro80m by 2006.
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