Mercedes-Benz preparing to axe 10,000 jobs

Three-pointed star makes further workforce cuts, with savings to be used for development of 'CO2-neutral mobility'.
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Daimler, owner of Mercedes-Benz, has confirmed it will cut at least 10,000 jobs between now and the end of 2022.

The jobs cuts will be achieved via voluntary severance packages, an expended part-time retirement program, and 'very restrictively' extended temporary workers' contracts. It will also offer shorter working weeks in order to rein in employment costs.

Under its current union agreement in Germany, the automaker is prevented from making forced redundancies until 2029.

"We will make the measures as socially responsible as possible," Wilfried Porth, head of human resources, said in a prepared statement.

Throughout the year Daimler has cut its profit forecasts multiple times with falling sales in China and elsewhere, as well as trade tensions between the US, EU and China, being the key culprits. The company has also been fined €840 million ($1.4 billion) for selling around 684,000 non-compliant diesel cars in Germany.

This latest move is part of a drive by the company to save €1.4 billion ($2.3 billion) within three years. In November Daimler announced it would cut 10 per cent of its management positions worldwide.

Globally the automaker employs just a tick over 300,000 people, so a reduction of 10,000 represents a reduction of around 3 per cent of the company’s head count.

Last month, Audi said it would be cutting 9,500 people from its workforce by 2025 with a similar percentage reduction in its management ranks. It said the process would free up billions of euros for EV and technology development.