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DEUTZ agrees further job cuts

Wednesday, August 19th, 2009

DEUTZ AG’s personnel restructuring programme is on schedule. At the beginning of July it had announced plans to shed a further 800 or so jobs worldwide, and yesterday the Company reached agreement with the works council on a reconciliation of interests for its largest production site in Cologne.
Under this agreement, approximately 650 jobs are to go at DEUTZ AG’s headquarters in Cologne and at its components plant in nearby Herschbach. Plans to reduce the workforce at the Company’s other sites are currently in the pipeline; the only employees not to be affected by these measures will be the permanent staff working at the plant in Ulm, whose jobs are protected under an agree-ment applicable to this site.
The downsizing of the Company’s workforce in Cologne and Herschbach is planned to take place in two stages. Some 500 jobs are scheduled to go in the fourth quarter of this year, and a further 150 positions may follow in the second quarter of next year, depending on how the Company’s business performs going forward.
Of the total of 650 jobs being cut, for more than 220 employments solutions have been found al-ready to avoid compulsory redundancies. Some members of staff have agreed to leave the Company voluntarily, and DEUTZ has offered employees a special early retirement package. Dr Marga-rete Haase, the member of the Board of Management responsible for HR and finance: “Over the past twelve months we have already reduced our total headcount by roughly 1,000 and, in doing so, have minimised any adverse impact on our staff. We aim to achieve the further workforce re-ductions needed by pursuing policies that are as acceptable as possible. We are therefore continuing to implement these measures as a matter of urgency and are supplementing them by working closely with a job creation and reskilling company.”
Staff transferred to this form of interim employment company – providing they meet the necessary criteria – can train for a new job while being paid a short-time working allowance. They are also given help when looking for new employment. If, after having retrained, they are unable to find a job, they are entitled to draw full unemployment benefit.
By signing this agreement, DEUTZ has now completed the introduction of its comprehensive »MOVE« action programme. It expects the implementation of these cost-cutting measures to achieve a lasting reduction in its fixed costs, thereby significantly lowering its break-even point. The Company recognised a sizeable provision of approximately €30 million in the second quarter of this year to cover the one-off charges resulting from its personnel restructuring plans.

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