Thyssenkrupp cuts 11,000 steel jobs

Thyssenkrupp AG will cut nearly twice as many jobs as planned as the beleaguered conglomerate's steel business spends money and the German government disputes a possible bailout.

The company said in a statement that the company will liquidate 11,000 jobs over the next few years.

He projects a net loss of over € 1 billion (US $ 1.2 billion) for the full year, after recording a € 5.5 billion deficit for the fiscal period ending in September.

Thyssenkrupp AG coking plant in Duisburg
“We will have to move further into the red zone before we prepare Thyssenkrupp for the future,” said Thyssenkrupp CEO Martina Merz.

“The next steps may be more painful than the previous ones, but we have to take them,” said Merz.

The COVID-19 pandemic has exposed and exacerbated deep-seated problems at a company whose steel division is facing major challenges from gaping retirement deficits and cheap imports from Asia.

Sources familiar with the negotiations said last week that Thyssenkrupp has been in talks with potential buyers and merger partners in the steel division to address the chronic overcapacity in the market.

The leadership is also in talks with the German government on an aid package worth up to € 5 billion, sources said.

This year, the conglomerate sold its valuable elevator unit for € 17.2 billion to buy time to restructure other parts of the business.

He now has about 13.2 billion euros in cash and unused credit lines.

Excluding elevator sales, Thyssenkrupp spent 5.5 billion euros in the last financial period, three times the outflow in the previous year.

He predicts another € 1.5 billion in negative free cash flow over the next 12 months.