Germany's ThyssenKrupp sees more job cuts after reducing work force by 11,000 in 9 months


Associated Press 

 FRANKFURT — German steelmaker ThyssenKrupp AG

said Friday it expects to lay off more workers after

shedding 11,000 jobs in the first nine months of

its fiscal year as it pursues cost-saving plans.

The company, however, stressed that it was

pressing ahead with new plants in the U.S. and Brazil.

ThyssenKrupp, which had 199,000 employees worldwide

at the end of the last fiscal year on Sept. 30, 2008,

has moved to reduce costs as the global downturn

cut sharply into demand for steel.

The Duesseldorf-based company, Germany's biggest

steelmaker, said it still expects further job losses

but declined to say how many.

Most of the cuts so far came outside Germany.

In addition, some 46,000 people have been

affected by shorter working hours as a result

of the economic crisis, 30,000 of them in Germany.

Employers' use of shorter work hours has been

credited with saving thousands of jobs

in Germany over recent months.

CEO Ekkehard Schulz said ThyssenKrupp's supervisory

board decided Friday to implement a new

restructuring program on Oct. 1 that should save

about euro500 million ($710 million) annually

in administrative costs.

Schulz said there would be savings in both fixed

and personnel costs, but did not elaborate.

That comes on top of the company's existing

cost-saving plan, which aims for savings

of more than euro1 billion in the current fiscal year.

Lower demand for machinery and cars in particular

during the downturn forced ThyssenKrupp

to cut its steel production.

The company reiterated it expects a pretax loss

for the full fiscal year "in the upper

three-digit million euro range."

Schulz told a news conference that

ThyssenKrupp's new steel facility near Mobile,

Alabama, would start producing in the spring

of next year at a reduced capacity and

initially would be supplied with

raw material from Germany.

ThyssenKrupp has not specified when

the stainless steel segment of the plant will

start production, and Schulz said managers

recommended that it stick to a flexible startup schedule.

Still, Schulz said that the company sees a

good chance of being the market leader

for stainless steel products in the

North American NAFTA region once

the economic downturn passes.

ThyssenKrupp also plans to start production

in mid-2010 at a new facility in Sepetiba, Brazil,

with a second furnace and converter being

added in 2011.

Schulz said the company could adapt

its plans to future market developments quickly.

He added ThyssenKrupp's board had approved

an increased investment by Brazilian ore producer

Companhia Vale do Rio Doce's in the joint-venture

company with Thyssen that will operate

the Brazilian plant, Companhia Siderurgica do Atlantico.

Vale will raise its stake in the operating company

to 26.8 percent from 10 percent,

an investment of euro965 million.

The step "reinforces the value of our investment

and strengthens our industrial concept," Schulz said.

ThyssenKrupp's shares closed down

about half a percent at euro22.85 ($32.59).


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