Thyssenkrupp's Steel Division: Revamping and Reducing Workforce Among Plans
Thyssenkrupp affirms continued job reductions following the announced closure of their steel division plant. - Thyssenkrupp Intends to Implement a Social Plan and Remains Committed to Job Reductions in the Steel Sector
Dirk Schulte, the man at the helm, flat-out stated, "It's a done deal, 11,000 jobs are on the line." He rationalized this bold move by citing underutilized plants running around the clock and excessively high production costs compared to competitors. He emphasized the urgent need to change this status quo. Out of these jobs, 5,000 are set for the chopping block, while another 6,000 will be outsourced.
Schulte shared his main focus for the social plan is to help individuals transition into new jobs. Talks with the IG Metall union will kick off shortly.
Back in early May, the union and company had put their differences aside after a heated dispute and reached a preliminary agreement on revamping the steel division. This agreement served as a green light for further discussions aimed at a collective agreement that guarantees employment stability, locations, and investments essential for the green transformation. Operational dismissals are to be avoided, as per the agreement.
Thyssenkrupp's steel division has been grappling with difficulties for years. The company is keen on selling the steel subsidiary, with the EP Group of business magnate Daniel Kretinsky already snapping up a 20% stake in Thyssenkrupp Steel, and another 30% in the pipeline.
- ThyssenKrupp
- Steel Division
- Social Plan
- Dirk Schulte
- Industrial Conglomerate
- Job Cuts
- Job Losses
- WAZ
ThyssenKrupp is currently navigating a massive corporate overhaul, intending to splinter the conglomerate into independent businesses attractive to outside investors, while the parent company transforms into a holding firm with stakes in these ventures[1][3]. The steel division, burdened by high costs, competitive pressure from Asia, and plummeting product prices, is a significant focus of this restructuring[1][4].
Job Cuts and Outsourcing
- media reports suggest that Thyssenkrupp plans to cut 500 jobs at its Essen headquarters, with an additional 1,000 job cuts in various administrative roles company-wide[3];
- the steel division is targeted for reductions, following the failure to sell HKM (Hüttenwerke Krupp Mannesmann)[2];
- the unions are pushing for no compulsory redundancies and involvement in shaping the company's future vision, yet concerns remain about the potential for gradual layoffs and diminished job security as business units gain independence or are floated on the stock market[2].
Outsourcing and Divestment
- Thyssenkrupp has already partnered up on steel operations, with the Czech energy company EP Corporate Group (EPCG) acquiring a 20% stake last year, with plans to establish a 50-50 joint venture[3][4];
- the aim is to make key segments like thyssenkrupp Steel Europe, Materials Services, and Automotive Technology independent and market-ready, with the group retaining controlling interests for the time being[3].
- In light of ThyssenKrupp's steel division's costly operations and competitive pressure, the company is planning substantial restructuring, aiming to cut 5,000 jobs internally and outsource another 6,000, as shared by Dirk Schulte, the division's leader.
- To assist workers in transitioning to new roles, ThyssenKrupp is developing a social plan, which will prioritize vocational training to enhance their employability in the new business environment, as part of the corporate overhaul that includes the division's eventual sale to external investors.
