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German household appliance manufacturer Miele said Tuesday that it was considering axing up to 2,700 jobs, as low demand and rising costs forced the group to make cuts.
The step was part of a plan to create “additional financial flexibility of around 500 million euros ($538 million)” by 2026, the group said in a statement.
Two-thirds of the savings would be made through “improvements on the sales side or reductions in material costs”, Miele said.
But the need for belt-tightening meant a “substantial reduction in personnel costs is also inevitable”.
Globally, up to 2,700 of the roughly 23,000 people employed by Miele could see their jobs cut or relocated, the group said.
“The global collapse in demand for household appliances and the drastic price increases” had caught up with Miele.
After three years of growth, which came despite the coronavirus pandemic, the group registered a provisional nine-percent drop in revenues in 2023, it said.
“There are no signs of an imminent market recovery,” the group said.
“What we are currently experiencing is not a temporary economic downturn, but rather a lasting change.”
Miele is the latest German manufacturer to announce job cuts as the country’s export-focussed industry contends with a global slowdown in growth and high rates of inflation.
Chemical giant Bayer said in January that it would make “significant” reductions in staffing, while auto supplier Bosch announced plans in December for 1,500 job cuts.
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