German chemicals company Lanxess AG may cut up to 1,200 jobs, around 7 percent of its workforce, as part of a group-wide overhaul to counter overcapacity in the synthetic rubber industry, the German daily Rheinische Post has reported.
News organization Reuters reported the German newspaper, citing company sources, said that Cologne-based Lanxess plans to offer voluntary layoff packages and early retirement opportunities, but will not rule out forced layoffs.
Reuters cited DZ Bank analyst Peter Spengler as saying in a note that such cutbacks could result in annual savings of 50-60 million euros ($62.4 million to $74.9 million).
Reuters stated that a Lanxess spokesman declined to comment on the story but said more information would be provided on Nov. 6, when the company is scheduled to publish third-quarter results.
In September 2013, Lanxess said it would cut 1,000 jobs from its 17,500-employee workforce as part of an efficiency improvement plan called “Advance.” It booked 150 million euros ($187.4 million) in charges for 2013 and 2014 to cover the program, but the company said at the time it expected to save about 100 million euros ($125 million) from 2015 onwards.
Lanxess also revealed its “Let's Lanxess Again” three-phase realignment plan along with its second quarter results on Aug. 6. The program will result in the consolidation of 14 business units to 10 in 2015. It will focus on three areas: business and administration structure competitiveness; operations competitiveness; and portfolio competitiveness.