Munich-based MAN is set to lay off as many as 9,500 staff in Germany and Austria as it implements "extensive restructuring," amid a major coronavirus-fueled downturn.
The Volkeswagon truck-making subsidiary reported an operating loss of €423 million ($500 million) in the first half of the year, and a revenue decline of 26%, as the spread of Covid-19 impacted customer demand and supply chains.
MAN is part of Traton SE, a subsidiary of Volkswagen AG and a commercial vehicle manufacturer worldwide with brands including MAN, Scania, Volkswagen Caminhões e Ônibus, and RIO. It makes light-duty commercial vehicles, trucks, and buses at 29 production and assembly sites in 17 countries. The company’s workforce prior to this announcement numbered around 82,700.
The auto company intends to save €1.8 billion ($2.1 billion) annually and achieve a return on sales of 8 per cent by 2023 in order to improve earnings and finance investment. The future of two factories in Germany and one in Austria is “up for discussion,” the company said.
The company was already struggling pre Covid-19, and had planned a cost-cutting program in response to a drop in demand that only worsened with the health crisis. MAN reported an operating loss of €423 million ($500 million) in the first half of the year, and a revenue decline of 26%, as the spread of Covid-19 impacted customer demand and supply chains. Other Carmakers including Mercedes-Benz maker Daimler and suppliers such as Schaeffler AG and Continental AG are also planning to axe thousands of jobs.
Man Truck & Bus chief executive Andreas Tostmann said the company was facing "major challenges" due to technological change, particularly with "digitalization, automation, and alternative drives". "This is why we need to restructure MAN: to become a lot more innovative, digital, and profitable in the long run," he said.
Edited by Ramata Diallo