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Business

Work Reduction Measures for Employees at Car Giant Daimler

The world recession and fall off in consumer demand has forced German carmaker Daimler to slash production costs and put workers on short time with reduced benefits. CEO Zetsche expects recovery for second half of 2009.

Worker examining engine of Mercedes car model

Shifts are being cut for 30,000 workers at plants in and around Stuttgart and Berlin

German car manufacturer Daimler introduced reduced working hours Monday for employees at factories across Germany.

Shifts are being cut to three or four days a week for 30,000 workers at core manufacturing sites in the company's home town of Stuttgart and its main plant in the suburb of Sindelfingen alone.

Until Sunday, many Daimler plants had been closed since mid-December for an extended winter break.

The measures, set to last until the end of March, will also affect operations in Berlin and the towns of Rastatt and Ludwigsfelde.

Workers are to receive reduced pay and government welfare benefits for the days when they are idle.

Most German carmakers, like their counterparts elsewhere, are reeling under the effects of the economic crisis and have been forced to slash production to offset a fall in consumer demand.

Speaking Sunday at the Detroit motor show, the chief executive of Daimler, Dieter Zetsche, said the consequences of the financial crisis had been underestimated in the car industry.

However he was cautiously optimistic for the remainder of 2009, saying it was conceivable that global demand would recover in the second half of the year.

In 2008 Daimler saw sales of its flagship brand Mercedes-Benz drop 5.4 percent. New car sales in Germany fell by almost two per cent in 2008, to 3.09 million new registrations. These are the lowest figures since German reunification in 1990.

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