Karmann has announced that it will cut 1,800 jobs, or around a quarter of its workforce, because of a decline in orders. The cuts will be made at its plants in Rheine and Osnabrueck.
Go deeper with GlobalData
Part of the reason for the decline is Audi’s decision to cease outsourcing assembly of the A4 convertibe. In addition, Karmann will lose contracts to assemble the Chrysler Crossfire in 2008 and the Mercedes CLK in 2009.
The cuts have been expected for some time. “There are simply no contracts around to assemble complete vehicles,” a Karmann spokesperson told dpa-AFX.
900 jobs will be lost at the Rheine plant, which employs only 1,000 people. The remaining jobs will be lost at Osnabrueck, which employs 4,000. That plant also produces roof systems. Karmann employs a further 2,000 people overseas, and is building a new roof systems plant in Poland.
While the market for complete vehicle assembly has been declining, the market for cabriolet roofs has been growing. According to dpa-AFX, the company is not ruling out a complete departure from the complete vehicle assembly business by 2009. This year it will assemble around 30,000 vehicles. Karmann managing director Peter Harbig believes the break-even point for vehicle assembly is 40,000 vehicles a year. As recently as 2004, Karmann assembled over 93,000 vehicles.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataThere are some grounds for optimism. Karmann is in talks to assemble a new cabriolet for Kia, and the decision about where to build a new Polo cabriolet has still not yet been made.
