Anticipated mass demonstrations as one out of every four ZF personnel is mandated to depart.
ZF, the German automotive technology company, is set to announce significant job cuts and restructuring measures as part of a broader cost-cutting and operational streamlining effort. The company aims to reduce up to 14,000 jobs in Germany by the end of 2028, which amounts to about one quarter of its workforce in the country.
The restructuring is primarily driven by financial losses, declining orders, and industry challenges, including slow adoption of e-mobility and rising competition. The company’s main concern is the underperforming Drive Systems division, which is responsible for almost all of ZF's current difficulties.
The Friedrichshafen plant, being a major hub and the company’s namesake city, faces significant impact within the restructuring plans. Management and unions have set a September 2025 deadline to decide the future of the powertrain division there, which is under consideration for carve-out or sale due to declining sales. The powertrain division is a large department within ZF, employing around 30,000 people worldwide.
The company expects massive job cuts at larger sites including its Friedrichshafen headquarters and plant, alongside potential closures of smaller plants with fewer than 300 employees. Since early 2024, about 5,700 jobs have already been eliminated, with further reductions planned.
The restructuring targets a minimum profit margin of 19% for each factory, putting older and less profitable, specialized plants at risk of closure or sale. ZF is considering selling the Drive Systems division to an external party as a possible solution.
The protests, triggered by the austerity measures implemented by ZF CEO Holger Klein, are expected to take place at ZF's headquarters in Friedrichshafen, with around 4,000 participants. Saarbrücken is particularly affected and could close in the worst-case scenario. Employees will march through the city center to the company headquarters and hold works meetings.
The management is scheduled to make decisions during the supervisory board meeting today, Tuesday. The most likely issue to be discussed is the realignment of the Drive Systems division, also known as Division E. The meeting is expected to decide on the future of ZF's company.
Sources:
- Reuters
- Bloomberg
- Handelsblatt
- Automotive News Europe
- What about the future of the powertrain division in Friedrichshafen, a city synonymous with ZF's history, as management and unions aim to decide its fate by September 2025?
- With the Drive Systems division, responsible for ZF's current difficulties, under consideration for carve-out or sale, could the automotive industry witness a notable financial restructuring or even a change in business ownership in the sector?
- As ZF aims to boost profit margins by targeting a minimum of 19% for each factory, could the underperforming transportation and automotive technology company see significant changes in its global workforce, potentially including the automotive hub of Saarbrücken?
