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Business

German steel producer Salzgitter plans drastic job cuts

Germany's second-largest steel producer, Salzgitter, has announced it cannot master restructuring challenges without massive job cuts. Like many rivals, it has suffered from low demand in crisis-hit Europe.

Salzgitter reported Wednesday it would have to cut about 1,500 jobs in the near future as part of its current cost-saving efforts.

The company, based in the western German state of Lower Saxony, did not immediately provide a time frame for the layoffs, saying the details of the scheme were currently being negotiated with staff representatives.

Salzgitter has been feeling the pinch of a protracted crisis in the sector caused by continuously low demand in debt-stricken southern European nations.

Disappointing figures

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German steel giant faces restructuring

The MDax-listed firm reported losses to the tune of 315.2 million euros ($418.3 million) for the first half of 2013.

Management had earlier identified a 200-million-euro savings potential, with the planned job cuts as part of the firm's attempt to turn the corner.

"Particularly with regard to our Peine subsidiary, we're fighting for survival," Salzgitter CEO Jörg Fuhrmann told reporters. The Peine facility accounted for no less than 60 percent of overall half-year losses from the company's operating business.

Germany's number-one steel maker, ThyssenKrupp, is also in the process of cutting thousands of jobs as a result of the unabated crisis in the sector.

hg/hc (dpa, Reuters)

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