BASF Plans to Cut 2,600 Jobs Worldwide
- Chaileedo Press
- Feb 27, 2023
- 2 min read
Updated: Apr 3, 2023
German chemical giant BASF said it plans to cut 2,600 jobs worldwide, with nearly two-thirds of the cuts in Germany, in light of a sharp drop in earnings in 2022 and a heavy burden from the energy crisis, some media sources said.
BASF reported a decline in its earnings due to changes in global demand and the loss of cheap Russian gas, which has been the company's mainstay for decades. At the same time, BASF also said it would cut its €3 billion share buyback program, which starts in January 2022. The main reason for this is the impact of changes in the global economy.
In addition, in 2022, due to high energy costs and the economic slowdown in Europe, BASF announced a cost-cutting plan targeting an annual cut of €500 million ($527.8 million) outside of production from 2024, half of which will be achieved at its Ludwigshafen headquarters.
BASF currently employs more than 111,000 people worldwide, including around 39,000 at its headquarters. The cost reductions will focus on the service, operations and R&D departments as well as the corporate headquarters.
Martin Brudermueller, Chairman of BASF's Executive Board, said in a statement on the same day that competitiveness in Europe is increasingly being affected by excessive regulation, slow and cumbersome approval procedures and, above all, high costs for most factors of production. For many years, these factors have inhibited growth in the European market. In addition, high energy prices are a drag on profitability and competitiveness in Europe.
Recently, BASF also announced its financial figures for 2022. The financial report shows that BASF's total sales for 2022 will be €87.3 billion ($92.2 billion), an increase of 11.1% year-on-year. However, based on current corporate performance, BASF expects sales in 2023 to be between €84 billion ($88.7 billion) and €87 billion ($91.8 billion).
By segment, sales to third parties in the Nutrition & Care segment rose by €1.624 billion ($1.7 billion) to €8.066 billion ($8.5 billion) in 2022. This was primarily attributable to the Care Chemicals division, which recorded sales growth of €1.18 billion ($1.25 billion) to €5.619 billion ($5.9 billion). In the Nutrition & Health division, sales rose by €444 million ($468.7 million) to €2.447 billion ($2.6 billion).
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