BASF announces further job cuts and savings program
The chemical company BASF is launching a further savings program due to weak demand in Europe. According to the DAX-listed company, additional annual costs of one billion euros are to be saved at the Ludwigshafen site by 2026. Fixed costs are to be reduced by increasing efficiency and production capacities are to be adapted to market requirements.
BASF’s management had already announced a cost-cutting program in 2022 due to deteriorating business and more difficult conditions in Europe, particularly as a result of the sharp rise in gas prices. This is intended to reduce annual costs by a total of 1.1 billion euros by the end of 2026. In addition, BASF intends to take further measures to reduce annual costs by 500 million euros from the end of 2026. The measures already include job cuts and the closure of several chemical plants. “Unfortunately, the program will therefore also involve further job cuts,” said CEO Martin Brudermüller.
The Executive Board’s outlook for this year is rather cautious: The weakness in global economic momentum is likely to continue and growth is not expected to pick up somewhat until later in the year. BASF is targeting earnings before interest, taxes, depreciation and amortization (EBITDA) and special items of between eight billion and 8.6 billion euros. As already announced, earnings in 2023 fell by almost 29 percent to just under 7.7 billion euros.
