Bosch boosts its cost-saving measures in the realm of transportation
Bosch, the German automotive supplier, has announced plans to reduce annual expenses for its mobility division by 2.5 billion euros by 2030. The cost-cutting measures, which include job cuts and reductions in material and energy costs, aim to ensure the long-term independence of the foundation-owned company.
The announcement was made by Bosch's board member Markus Heyn and labor director Stefan Grosch. However, the exact number of jobs at risk has not been specified. The works council chairman for the supply division, Frank Sell, called for more transparency from management regarding future plans for the mobility division in Germany.
Sell also urged the management to be concrete about the job cuts, particularly for the Reutlingen plant where up to 1,100 jobs may be cut by 2029 as the plant shifts focus to semiconductor manufacturing and reduces production of electronic control units.
The technological shift towards electric vehicles, which require less personnel, is another factor contributing to the potential job cuts. Stagnating global automotive markets, intensified global price competition, particularly from China, and increasing competition from international suppliers are also reasons for the challenges faced by Bosch.
Profit targets have rarely been met in the past due to these reasons. In 2024, Bosch's automotive division achieved a profit margin of 3.8 percent, below its target of seven percent. The company needs a higher margin to ensure its long-term independence.
Barbara Resch, district leader of IG Metall, urged Bosch not to rely solely on cuts to ensure its future viability. Instead, she emphasized that the future is created through investments, innovation, and cooperation, not just through austerity programs.
Despite the cost cuts, Bosch expects a slight increase in sales of around two percent in 2025, with growth drivers being classical components, software, high-performance computers, and solutions for automated driving. The necessary decisions are to be made and negotiated with employee representatives by the end of 2025.
The announcement was made in an interview with the Stuttgart Zeitung and Stuttgart Nachrichten, and it is clear that Bosch is facing a challenging period. However, the company remains optimistic about its future and is committed to navigating these difficulties while maintaining its commitment to its employees and stakeholders.
