German manufacturing giant Bosch announced plans to reduce working hours for hundreds of employees to a four-day week schedule, reflecting deepening challenges in Europe's largest economy.
The €92 billion industrial conglomerate will cut weekly hours from 38-40 to 35 hours for 450 workers at its Stuttgart and Gerlingen locations starting March 1, 2024. The reduction comes with a corresponding decrease in pay for affected employees.
The move follows Bosch's October announcement of 7,000 planned layoffs after the company warned it would miss its 2024 financial targets. As a major automotive supplier generating over half its revenue from car parts like brakes and spark plugs, Bosch faces mounting pressure from declining European car demand and intensifying Chinese competition.
The automotive sector's struggles extend beyond Bosch. Volkswagen is pursuing €10 billion in cost reductions, including proposed 10% staff pay cuts, while considering unprecedented steps like closing a German plant. The automaker's profits hit a three-year low in early 2024.
Similar workforce adjustments are occurring across European auto manufacturing. Fiat's Turin plant, owned by Stellantis, has already shifted from double to single shifts while furloughing workers.
These industry challenges mirror Germany's broader economic woes. The country faces a second straight year of economic contraction, with its manufacturing sector mired in a two-year recession. The combination of high energy costs following Russia's invasion of Ukraine and weakening export demand has severely impacted Germany's manufacturing-focused economy.
For Bosch employees, the shortened workweek represents an unwelcome adjustment as the company grapples with deteriorating market conditions. Chairman Stefan Hartung has not ruled out additional workforce reductions as the supplier navigates ongoing industry turbulence.
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