The automotive industry has been struggling recently, with major companies like Volkswagen and Tesla reporting worse-than-expected results. This downturn has already led to layoffs and cutbacks across the sector, and now another manufacturer is following this unfortunate trend.
1,000 Employees on Temporary Unemployment
Schaeffler, one of Germany's largest automotive component manufacturers, is set to lay off 800 employees from its plant in Cristian, Romania, by the end of this year.
This decision comes in response to significant financial challenges caused by the severe economic downturn in Germany, which has directly impacted operations in Romania, according to Ziare.
The Cristian factory, heavily reliant on orders from Germany, has faced disruptions since summer 2023. Nearly 1,000 workers were placed on temporary unemployment for two months, highlighting the economic struggles faced by both the company and the region.
According to BizBrașov, Schaeffler’s reliance on German demand has left the plant vulnerable as Germany’s economy faces ongoing instability.
Faces Persistent Obstacles
In a statement, Schaeffler acknowledged the challenging business environment, stating:
"Our bearings and industrial solutions division continues to face persistent obstacles. We are constantly adapting to market conditions and exploring all available options to remain competitive."
To mitigate the social impact of the layoffs, Schaeffler has implemented a plan offering employees voluntary departure packages and early retirement options. Workers opting for voluntary exits will receive severance pay to soften the blow of these workforce reductions.
Despite the company's efforts to diversify its business — such as its recent merger with Vitesco Technologies, a manufacturer of electric vehicle components — the layoffs reflect broader difficulties Schaeffler is facing.
The merger, completed last week, signals the company’s intent to expand into the rapidly growing electric vehicle market. With four operational locations in Romania employing over 8,500 people, Schaeffler's future presence in the country remains strong.
