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A shortened workweek has been touted as a way to encourage efficiency and engagement, not a way to cut pay. But one German company is using it as it tries to drastically reduce costs.
Where in the world? Germany is Europe’s largest economy, but has struggled since 2022 amid weak demand for exports like electric cars and competition with China. Now, Robert Bosch, a German autopart supplier with 429,000 global employees as of 2023, announced plans to cut some employees’ hours as the company tries to save costs, Fortune reported. The move came shortly after a fresh round of layoffs affecting 5,550 workers (3,800 in Germany), on top of the 7,000 workers who were let go in October.
Roughly 10,000 employees will see their hours reduced from 38–40 hours a week to 35 hours.
The auto industry has been fairly stagnant in recent years. Volkswagen, BMW, and Mercedes Benz also conducted layoffs earlier in 2024.
“We must adjust our structures to the changing market environment and reduce costs in the long term to strengthen our competitiveness and make the division fit for the future,” Stephan Hölzl, executive vice president of finance and administration at Bosch, told Fortune.
Satellite view. US car makers have made tough decisions this year as well. Ford, GM, and Stellantis all cut US jobs, mainly in the midwest, Bridge Michigan reported.
“Any company in this market, this global market, has to have speed,” Glenn Stevens Jr., executive director of auto advocacy group MICHAuto, told the news outlet. “You have to be as efficient and streamlined, and have the right people in the right positions, to execute like that.”