Germany’s BASF to shed 2,600 jobs in cost-cutting drive

Berlin –

Chemical maker BASF said Friday it plans to cut about 2,600 jobs in a cost-cutting effort partly driven by high energy prices. The announcement comes after accusations related to the exit of the company’s gas and oil subsidiaries from Russia pushed the company into the red in 2022.

BASF, based in Ludwigshafen, Germany, said the cost-cutting program, which will be implemented this year and next, will generate annual savings of more than €500 million (US$530 million) for its services, sales and research and development divisions. said. main office.

“The measures are expected to have a net impact on around 2,600 positions globally. This figure includes the creation of new positions, especially in our hubs,” BASF said in a statement.

It said some factories at its sprawling Ludwigshafen plant would be closed, affecting about 700 production jobs. However, CEO Martin Brudermuller said the company “is confident that most of the affected employees will be able to offer employment at other factories.”

These measures will be implemented by the end of 2026 with the aim of reducing fixed costs by more than €200 million per year.

BASF reported a net loss of €627 million in 2022, following a profit of €5.5 billion in the previous year. The result was weighed down by the exit of gas and oil subsidiary Wintershall Dea from Russia and his €6.3 billion expenses mainly related to the unit’s gas transportation business.

They included a full write-down of the company’s participation in Nord Stream AG. Wintershall Dea holds his 15.5% stake in the operator of the Nord Stream 1 pipeline that runs under the Baltic Sea, majority-owned by his Gazprom in Russia and has not shipped gas to Germany since August. was The pipeline was damaged in her September explosion, which investigators call sabotage.

In announcing the move to cut costs, Brudermüller said that “Europe’s competitiveness is increasingly suffering from over-regulation, slow and bureaucratic permitting processes and, in particular, the high costs of most production inputs.” I expressed my dissatisfaction.

“All of this has already hindered market growth in Europe compared to other regions,” he said. “High energy prices are now putting an additional strain on Europe’s profitability and competitiveness.”

According to BASF, there are over 111,000 employees worldwide.

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