The chemical company BASF has announced further job cuts at its Ludwigshafen site. The group made a profit everywhere in 2023, just not in Germany.
The world‘s largest chemical company experienced a slump in profits last year – the bottom line was that just 225 million euros were left. Sales also fell sharply. The company announced this on Friday. Accordingly, BASF has even slipped into the loss zone in Germany. “The situation is serious,” said CEO Martin Brudermüller. At the main location in Ludwigshafen, even more savings are to be made. Further positions are to be eliminated.
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It is still unclear how many jobs will be lost
The main plant is expected to save around an additional billion euros a year in costs by 2026. At the annual press conference, CEO Martin Brudermüller left it open how many jobs would have to be cut. However, other individual systems on the factory premises would also be shut down. BASF had already announced job cuts at the main site in February 2023, with 2,500 jobs to be eliminated. There probably won’t be quite as many in the second round of austerity. At the turn of the year, BASF still employed 38,710 people in Ludwigshafen, 430 fewer than the year before. The first wave of job cuts has not yet been implemented.
CEO Brudermüller: “The situation is serious”
“The situation is serious, so we are not explicitly ruling out any measures,” said CEO Martin Brudermüller at midday. His contract ends with the general meeting in April. A stable dividend of EUR 3.40 per share is proposed to shareholders there. But the prospects for the main plant remain bleak: “The location has been in the red for a few years,” said CFO Dirk Elvermann. That’s why savings are not only made in personnel, but also in outsourcing and purchasing. BASF’s production in Germany is suffering from low demand and high energy prices.
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Union criticizes cuts
The IGBCE union has criticized the austerity program. Instead of one savings program after the next, future investments in the location and a perspective are needed, according to a statement from district manager Gunther Kollmuß.
Profit collapse in 2023
In the group as a whole, sales fell by over 20 percent in 2023 compared to the previous year, and profit after taxes and controlling interests fell to 225 million euros. In good years this was several billion. In order to build on these times throughout the group, BASF wants to invest primarily in China, where production is cheap and demand is high.