Bosch, the German automotive components giant, has announced plans to lay off 7,000 employees due to ongoing economic challenges and business difficulties. The job cuts will primarily impact positions in Germany, particularly within the company’s automotive supply sector. Additionally, roles in Bosch’s tools division and its BSH household appliances subsidiary will also be affected.
These cuts are part of an effort to address the company’s struggle to meet financial targets for 2024, and further staffing adjustments are not ruled out. Although Bosch reported $98 billion in revenue for 2023, it is facing significant financial pressures. The company’s return on sales is projected to decline to four percent this year, down from five percent last year, with a target of reaching seven percent by 2026. This forecast reflects the challenging financial landscape affecting many players in the automotive industry, including Bosch, which is contending with evolving market conditions and rising production costs.
Despite the job cuts, Bosch is pursuing an ambitious acquisition strategy. The company has announced its largest-ever purchase: an $8 billion deal to acquire the Irish company Johnson Controls. This acquisition aims to strengthen Bosch’s position in the growing heat pump and air conditioning sectors, in line with the company’s strategic vision to diversify its portfolio and expand into high-demand energy-efficient technologies.
The layoffs at Bosch highlight the broader challenges facing the German automotive sector and the European economy as a whole. In a related development, Volkswagen, another major player in the industry, reported that its profits hit a three-year low in the third quarter. Workers are now threatening strikes in response to cost-cutting measures that could include potential plant closures and wage reductions.
