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Thyssenkrupp to cut 800 jobs at automotive business

·1-min read
FILE PHOTO: ThyssenKrupp steel factory in Duisburg
FILE PHOTO: ThyssenKrupp steel factory in Duisburg

FRANKFURT/DUESSELDORF (Reuters) - German conglomerate Thyssenkrupp <TKAG.DE> will cut 800 automotive system engineering jobs, it said on Tuesday, and said auto demand could take up to three years to recover.

The impact of the COVID-19 pandemic has added to pressures on Thyssenkrupp, which is striving to turn around its loss-making business units after selling its elevator division, by far its most profitable asset, to a private equity consortium earlier this year.

Its shares are trading at their lowest since mid-May when the pandemic's impact on the stocks of industrial companies around the world was severe.

"We don't expect output figures in the auto industry to return to pre-crisis levels for at least two to three years," Ingo Steinkrueger, head of Thyssenkrupp System Engineering, said in a statement.

Thyssenkrupp in May said that System Engineering would be broken up, with two sub units - car body solutions and lightweight solutions - becoming part of the Automotive Technology division.

The remaining parts - battery solutions and powertrain solutions - are being shifted to the Multi Tracks unit, which accounted for 6 billion euros (5.44 billion pounds) of sales, 20,000 jobs and 400 million euros of negative cash flow last year.

Thyssenkrupp's delicate financial situation has given rise to speculation it might seek state participation, but Andreas Pinkwart, economy minister of Thyssenkrupp's home state North Rhine-Westphalia, said no request had yet been made.

Pinkwart also said he could not comment on whether the German government was holding talks with Thyssenkrupp over taking a stake, adding he would support efforts to give the steelmaker financial aid to decarbonise its activities.

(Reporting by Christoph Steitz and Tom Kaeckenhoff; editing by Thomas Seythal and Barbara Lewis)