ZF Friedrichshafen, the German company that manufactures auto components, will be slashing about 15,000 jobs over a period of five years, and most of it in Germany alone. That means, by 2025, it will lay off about 10 per cent of its global workforce.
The auto sector has anyway been struggling to fight the economic slump, and the COVID-19 pandemic has only added to its woes.
The CEO of ZF has informed the employees via an official e-mail that the dearth of demand from customers has led to severe losses in 2020 that have forced the Company to downsize. The CEO did not see the situation improving even by 2022 in terms of sales.
Operating out of 122 locations across 26 nations, ZF is amongst the 15 largest automotive suppliers in the world. It helps car manufacturers develop gearboxes and hybrid drivetrains, It supplies components to Tata, Ford, JLG, General Motors, Mercedes-Benz, John Deere, among other big names. It supplies directly to automobile manufacturers and also from its locations in Tuscaloosa (Alabama) and Adelaide, in Australia.
However, it is not the only company in the automobile space to opt for the extreme step of downsizing. Last week, Renault had also announced plans to lay off 15,000, after having suffered losses for the first time in ten years last year.
India was not spared by the slump in the automobile sector last year. Around the same time in 2019, heavy job cuts took place in the sector in the months of June and July, with many showrooms being shut down across the country.