DaimlerChrysler to cut 6000 jobs
After General Motors and Ford Motors in US, it is the turn of the world’s fifth-biggest carmaker, DaimlerChrysler to announce their plans to cut jobs. The company has announced their plans to cut a fifth of its white-collar staff over the next three years. This means that DaimlerChrysler would be laying off around 6000 workers in the coming days.
This massive restructuring step taken by the company is expected to cost them a massive $2.5 billion by the end of 2008 but is expected to benefit the company in the longer term. The company said in a statement on these plans: “Together with other ongoing efficiency programs … G&A (general and administrative) costs are expected to be reduced by 1.5 billion euros per year. The net effect of today’s (steps) will be (savings of) 1 billion euros per year.â€
They have further plans to foster ties between premium car division Mercedes and U.S. arm Chrysler in purchasing, research, and development. However, the brands would continue to work independently and have a distinct approach to target their respective markets. These plans helped the company improve their stock position in the share market but have been criticized by the German works council.
German works council head and deputy group chairman Erich Klemm said in a statement: “It seems eliminating jobs is becoming the central means to boost efficiency in the company.â€