Bosch is to cut 1,100 jobs at its Reutlingen plant in southern Germany by 2029, with the car parts maker citing a need to restructure its plant during a rapidly worsening market in the automotive industry, and saying the market in electronic control units is no longer competitive.
Rising costs, market challenges and pricing pressures have led the company to a decision to focus the plant mainly on manufacturing semiconductors, Bosch said. Germany’s automotive sector is currently facing challenges from falling demand and increasing competition – described as “ferocious” by Reuters – from cheaper alternatives from producers in China and other countries.
“The European market for control units is highly price-driven and fiercely contested by new entrants,” said executive vice president of semiconductor operations for the company, Dirk Kress, said.
“The necessary job cuts are not easy for us, but they are urgently needed to secure the future of the site.”
Some 10,000 people are employed in the factory in Reutlingen, but other cost-cost-cutting measures elsewhere have also been announced by Bosch.
Last October, Bosch announced that 5,000 job losses across international operations could be expected as the company fought to stay competitive.
However, the head of the workers’ council for Bosch’s automotive division in Germany, Frank Sell, called the planned layoffs a “slap in the face” at the time and said workers would resist the cuts.
Now, apart from the Reutlingen cuts, a subsidiary of the German engineering and technology giant, Bosch Engineering, says it will cut 460 jobs globally by the end of 2027, and 380 of those cuts are expected to take place in Germany.
Last year, Bosch said it needed to adapt structures “to the changing market environment and reduce costs sustainably to strengthen our competitiveness.”
The German company said there was stagnation in the automotive market.
“Global vehicle production will stagnate this year at around 93 million units, if not decline slightly compared to the previous year,” Bosch said.
It also pointed to the significantly fewer parts to make electric vehicles as a driver of job cuts.
Other German manufacturers gave also announced layoffs, including Volkwagen planning wide-reaching plant closures and layoffs, a move also opposed by labour unions.