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German automaker Mercedes-Benz has announced a plan to cut multi-billion euros in costs in response to a deteriorating business environment, according to a report by dpa-AFX posted on MarketScreener.<\/p>\n
A company representative was quoted as saying: \u201cIn the coming years, we will reduce our costs by several billion euros a year.\u201d<\/p>\n
However, specific cost-cutting measures remain undisclosed, and the potential impact on jobs is currently unclear.<\/p>\n
The announcement comes as the German automotive industry faces challenges, including the transition to electric vehicles and increased competition in the Chinese market.<\/p>\n
Mercedes-Benz justified the cost-saving measures by citing the volatile global economic situation.<\/p>\n
“The economic situation remains extremely volatile worldwide. Only by sustainably increasing efficiency will we remain financially strong and able to act,\u201d the representative said.<\/p>\n
Mercedes-Benz has emphasised the importance of maintaining financial strength through significant savings, including reductions in fixed costs.<\/p>\n
“We are continuing along this path calmly but extremely consistently,” the spokesperson added.<\/p>\n
Reports from \u201cStuttgarter Zeitung\u201d and \u201cStuttgarter Nachrichten\u201d indicated that the company’s top management has communicated the cost cutting strategy to higher management, though specific actions have not been detailed.<\/p>\n
Despite the cost-cutting plans, Mercedes-Benz assured that job security for most employees in Germany remains intact.<\/p>\n
The \u201cZusi 2030\u201d agreement rules out compulsory redundancies until the end of 2029.<\/p>\n
In late October, Mercedes-Benz reported a decline in profits for the third quarter, with group profit dropping over 50% year-on-year to \u20ac1.72bn ($1.8bn).<\/p>\n
Turnover decreased by 6.7% to \u20ac34.5bn.<\/p>\n
At the time, CFO Harald Wilhelm noted that these results did not meet the company’s expectations, highlighting the need for cost reductions.<\/p>\n
This announcement aligns with similar strategies by other automakers, such as Volkswagen, which is also considering cost reductions<\/a> to enhance competitiveness.<\/p>\n Volkswagen’s workers union has proposed $1.6bn in savings, contingent on avoiding plant closures in Germany.<\/p>\n The automaker plans to cut costs by over $17bn, including potential job cuts at six plants in Germany.<\/p>\n This week, US automotive major Ford announced plans to cut its workforce<\/a> in Europe by 4,000, with majority in Germany (including 800 in the UK).<\/p>\n “Mercedes-Benz plans cost reductions amid industry challenges \u2013 report ” was originally created and published by Just Auto<\/a>, a GlobalData owned brand.<\/p>\n