Automotive supplier: Bosch is intensifying its workforce cuts – 750 more jobs will be lost

Bosch plans to cut 750 jobs at its Abstatt site by the end of the decade. The reason is the increasingly tough competition with Chinese competitors.

The staff cuts primarily affect the Vehicle Motion division, which develops braking systems, vehicle movement software and vehicle sensors. Other areas of the site are not affected.

Bosch had already halved its workforce in Nuremberg to 900 and, together with the current step, announced a total of 1,650 additional job cuts in Germany.

Bosch boss Christian Fischer wants to spin off the mobility division and define eight future areas in order to improve the group's profitability in the long term.

The summary was created and editorially checked using AI.

Stuttgart. Bosch wants to cut an additional 750 jobs in the mobility division at the Abstatt site, as the company confirmed to Handelsblatt upon request. The reason is the difficult situation in the auto industry. The dismantling, which is scheduled to be completed by the end of 2029, will be carried out in as socially responsible a way as possible.

Bosch cites competition with Chinese competitors as the main reason. Modern integrated braking systems are subject to significantly greater price competition, and Asian providers are increasingly entering the European market with more cost-effective solutions.

At the same time, Bosch's activities in China have a negative impact on the Abstatt location, for example with the so-called brake-by-wire systems. The more risk-averse Chinese car manufacturers introduced Bosch systems for braking and steering without mechanical connections before German customers.

They were developed together with Chinese customers at the local Bosch development site in China and not in Germany. “Customer-related tasks are no longer necessary in Abstatt,” says divisional finance director Mohammed Abraham to the Handelsblatt. At the same time, competition in these future fields is increasingly determined by price.

“In order to secure Abstatt’s role in the long term, we have to adapt our structures and costs – unfortunately there is no way around that,” said Abraham. However, Abstatt should remain a development location.

Abstatt has so far played a special role. Unlike classic manufacturing plants such as Feuerbach, Schwieberdingen or Bühl, Abstatt is a location for development, software and engineering services.

The units also based at the site, the Cross-Domain Computing Solutions division and the subsidiary Bosch Engineering GmbH, are not affected by the plans. At Bosch Engineering, however, 480 jobs were cut at the Abstatt and Holzkirchen locations last year, also because car manufacturers are awarding fewer and fewer development contracts.

The current reduction affects the vehicle motion area, in which, in addition to braking systems, vehicle movement software, occupant protection systems and vehicle sensors are developed. A total of around 5,300 people currently work in Abstatt. The workforce was informed on Tuesday evening. The measures come in the middle of collective bargaining. The peace obligation expired at the beginning of the week, and on Monday thousands of employees, including from Bosch, took to the streets for warning strikes.

Bosch will lose 24,000 jobs in Germany by 2032

A few weeks ago, Bosch announced that it would halve the workforce at its Nuremberg plant to 900. Overall, Bosch is cutting 1,650 jobs in addition to the 22,000 jobs in the mobility division in Germany that have already been announced from 2024. The duration of the reduction programs varies. The latest date so far is 2032.

Bosch wants to save 2.5 billion euros annually. This burden affects all companies and business areas. But Abstatt is unlikely to have been the last additional intervention. The current step shows that the situation in the automotive supply industry is getting worse and the job cuts that have already been announced are not enough.

Industry

Schaeffler is cutting thousands of jobs in Germany

Just on Tuesday, competitor Schaeffler announced that it would cut 3,460 jobs across Europe, including 2,660 in Germany. The Franconian supplier wants to save around 300 million euros annually through the new program. Companies are digging deep into their pockets to ensure the social compatibility of workforce reductions. Schaeffler has to set aside almost half a billion euros for severance pay programs and early retirement regulations. At Bosch, it is over four billion euros across the group - money that is missing for investments in future-proof business areas.

“We are aware of our responsibility for our employees and want to find fair and sustainable solutions together with our employee representatives,” says divisional finance director Abraham.

Bosch also produces household and electrical appliances as well as industrial and building technology. The mobility division is still the world's largest auto supplier with sales of 27.8 billion euros in the first half of the year, despite a decline of 0.5 percent. However, the pressure on the group is growing: the Chinese battery manufacturer CATL is getting closer with its electric car business. In the first half of the year, CATL achieved sales of around 25 billion euros. Bosch does not build battery cells for electric cars.

Christian Fischer: The new Bosch boss is quickly restructuring the company.

Bosch boss Christian Fischer, who has been in office since July, announced two weeks ago that he would spin off the entire mobility division into a separate GmbH. In addition, the semiconductor area will be spun off from the mobility division into its own division. The individual steps bear the clear signature of a portfolio manager.

Fischer wants decentralization with more, but also clear, local responsibility. This structure creates the necessary transparency, especially when things are not going well. Options such as savings programs, finding a partner and even selling or even closing can then potentially be implemented more quickly.

Profitability varies greatly between and within the group divisions. In the interview, Fischer announced that he would define eight future areas in the coming year on which he wants to focus the 140-year-old company. The current measures are seen in the industry not only as an urgent cost reduction, but also as preparation for the announced future strategy.

Industry

The world's largest automotive supplier Bosch is growing - but only through acquisitions

The group expects profitability to improve in the future, but the road ahead is rocky. The job cuts are embedded in the profound change in the automotive industry. Customs policy, global competition from China and the security of entire value chains are at stake.

The diversified group is active in many areas. But in recent years it has become increasingly unclear what Bosch really stands for. When it comes to software and chips, the competitors are overwhelming. The auto supply business is large, but has been shaken by transformation and is threatening its dominance. Building Services is still integrating the billion-dollar acquisition of Johnson Controls' air conditioning business. The household appliance sector is in a tough price war with Asian manufacturers, especially for small appliances.

The next few years will determine the shape and size in which the Bosch conglomerate emerges from the corporate restructuring.