Daimler wants to lay off 10% of its management workforce globally and and freeze its 300,000 employees’ paychecks in Germany, according to information published by Reuters.
Daimler expects its 2018 revenues to be significantly lower than the figures recorded in 2017, with a significant decrease to be recorded by the Mercedes-Benz Cars division. Daimler recently announced that its 2018 profit could fall by 10% due to “multi-region government procedures” on Mercedes-Benz diesel vehicles.
In this context, the German press claims that Daimler’s CEO, Ola Källenius, seems determined to cut costs to the limit. In doing so, he avoids any conflict, neither shuns the confrontation with his executives nor with the works councils. His savings plans affect everyone – from the highly paid top manager to the worker on the tape. Specifically, the 50-year-old wants to delete 1100 executive positions worldwide. In Germany, every tenth executive job should be eliminated. In addition, all employees in Germany should refrain in the coming year from their pay increases and individual increases in wages.
Daimler declined to comment on “speculation”, but then said the company had “constructive discussions” with employees’ representatives before presenting a new cost analysis.
So far, Ola Källenius has been very vague about his savings plans. The new chief executive officer of Daimler always spoke of urgently needed increases in efficiency. An update of the Daimler strategy is expected from its CEO on November 14. He has already confirmed a 10-billion Euro investment ($11 billion) investment in the development of the electric cars, including an unexpected electric Mercedes-Benz G-Class.