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Mercedes-Benz owner to axe at least 10,000 jobs worldwide

·Finance and policy reporter
Mercedes Benz vehicles and logos are seen at a dealership in San Jose, California on August 26, 2019. During the G7 Summit in Biarritz, France, German Chancellor Angela Merkel hoped the European Union would reach a trade deal with the United States as soon as possible, while Donald Trump said he hoped he would not have to consider imposing tariffs on German car exports. (Photo by Yichuan Cao/Sipa USA)
Mercedes Benz owner Daimler is slashing jobs. Photo: Yichuan Cao/Sipa USA

The owner of Mercedes-Benz is set to slash at least 10,000 jobs around the world as it invests heavily in electric vehicles and struggles with a global slowdown in demand.

Daimler (DAI.DE) confirmed it would slash thousands of jobs worldwide. It did not give a precise figure globally or in the UK, but said it could be a “low five-figure number” across the globe by 2022.

The Mercedes-Benz UK group of companies directly employs over 4,000 people.

The plans come as part of a major cost-cutting programme at a challenging time for the car industry, which has seen slowing demand particularly in China, tougher environmental standards in Europe and damage from the US-China trade war.

The announcement marks the third in a week of cost-cutting at major carmakers.

Audi said it would cut up to 9,500 jobs to also shift towards electric vehicle production, while BMW said it would also reduce bonus and other pay schemes to cut costs, according to Reuters.

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“The automotive industry is in the middle of the biggest transformation in its history,” said the company in a statement on Friday.

“The development towards CO2-neutral mobility requires large investments, which is why Daimler announced in the middle of November that it would launch a programme to increase competitiveness, innovation and investment strength.

“Part of this programme is to reduce staff costs by around € 1.4bn by the end of 2022 and, among other things, to reduce the number of management positions worldwide by 10%.”

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“We will make the measures as socially responsible as possible," said board member Wilfried Porth in a statement.

Daimler has repeatedly cut its profit outlook in recent months. The company added that Daimler had agreed with employee representatives to offer the workforce lower weekly working hours, and to limit re-hires of temporary workers.

It said previously agreed protections for some jobs in Germany would remain in force.

The many headwinds facing carmakers have led to cutbacks across the industry throughout 2019. Ford announced up to 12,000 job losses and closures of European factories in June by the end of 2020. Nissan said a month later that 12,500 jobs would go worldwide.

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