The Brose company has been in the red for four years. Now the management has sent a harsh message to the employees.
The owners and management of the automotive supplier Brose are dissatisfied with the mood among the workforce and want to cut costs. In an unusually harshly worded statement on Friday, it was said that the lack of motivation among the 31,000 employees was “noticeable through an extraordinarily high fluctuation”. The family company from Coburg did not give any figures.
Almost a third of the workforce works in Germany – but the manufacturer of door and seat components has been in the red there for four years. “Compensation for the associated cost disadvantages can only be achieved through above-average performance,” says the statement.
The family shareholders around Michael Stoschek have therefore asked the management to simplify processes and “significantly streamline” the organization. The costs in production, logistics and administration must be reduced. Brose left it open whether this would also involve job cuts.
Return on sales “absolutely unsatisfactory”
In addition, more attention must be paid to returns in takeovers and unprofitable transactions must be ended. In December, Brose boss Ulrich Schrickel celebrated the return to profitability after the company had made losses for the first time in 2021.
Now the shareholders described the return on sales of 1.1 percent as “absolutely unsatisfactory”. With sales of 7.5 billion euros, which increased significantly through a joint venture with Volkswagen, this translates into a profit of a good 80 million euros. For the first time, Brose was no longer able to finance itself and had to take out bank loans “to a considerable extent”. Due to problems in logistics, the inventories have swollen. With the conversion into a Europa-AG (Societas Europaea, SE), Brose is to be made capital market-ready.
For the current year, Brose expects sales of 8.6 billion euros. The owner family has approved investments of 422 (2022: 332) million euros to further expand capacities.
