Thyssenkrupp to cut 11 thousand jobs in its steel division

German group Thyssenkrupp will cut 11,000 employees in its steel division and production capacity. This is stated in the company’s press release.

These steps are envisaged in the plan for a comprehensive future industrial strategy presented by the Executive Board of Thyssenkrupp Steel Europe AG.

According to the company, the planned adjustment of the production network and optimization of administration will lead to the loss of about 5 thousand jobs by 2030. Thyssenkrupp Steel intends to reduce the number of employees by another 6 thousand by outsourcing some operations to external service providers or by selling the business.

The company also plans to reduce personnel costs by an average of 10% in the coming years.

The announced job cuts caused outrage among trade unions. Germany’s IG Metall called the published plan a disaster and promised to resist these changes.

In addition, the document provides for a reduction in production capacity from the current 11.5 million tons to the future target level of 8.7-9 million tons.

A key element of the capacity reduction is the separation from Hüttenwerke Krupp Mannesmann (HKM).

“The main goal is to sell HKM shares. If a sale is not possible, Thyssenkrupp Steel will negotiate with the other shareholders on mutually acceptable closure scenarios. In addition, it is planned to close the processing site in Kreuztal-Aachen,” the company said in a statement.

According to Thyssenkrupp Steel CEO Dennis Grimm, the company wants to create long-term prospects for as many employees as possible. Therefore, it will adapt to the changed market conditions by targeted capacity adjustments and cost reductions.

Thyssenkrupp Stee noted that it remains committed to environmental transformation and zero-carbon steel production. The company is on track to complete the direct reduction plant. At the same time, negotiations with stakeholders are underway to ensure the economic viability of this major investment project in a changing environment.

By 2030, the two blast furnaces No. 8 and No. 9 in Duisburg will be replaced by a DR unit and two planned innovative melting furnaces with a total capacity of 2.2 million tons per year.

“In the future, another blast furnace may be replaced, for example, with a modern electric arc furnace. However, this decision will be made only later and under the economic, technological and political conditions in force at that time,” Thyssenkrupp Steel said.

As GMK Center reported earlier, the German concern Thyssenkrupp announced a €1 billion impairment loss on the non-current assets of its steel division in FY2023/2024. The company cited a deteriorating outlook for the sector as weak demand and Asian competition hurt German industry.