Bosch Group Faces Economic Challenges, Announces Over 7,000 Job Cuts

Bosch Group Faces Economic Challenges, Announces Over 7,000 Job CutsGerman industrial giant Bosch Group recently announced that it will not meet its economic targets in 2024 and may further adjust its workforce. This news has garnered significant attention within the industry, reflecting the immense challenges posed by the global economic downturn and the automotive industry's transformation

Bosch Group Faces Economic Challenges, Announces Over 7,000 Job Cuts

German industrial giant Bosch Group recently announced that it will not meet its economic targets in 2024 and may further adjust its workforce. This news has garnered significant attention within the industry, reflecting the immense challenges posed by the global economic downturn and the automotive industry's transformation.

According to Polish media outlet Rzeczpospolita, Bosch CEO Stefan Hartung stated on November 4th that the company will miss its economic targets in 2024 and may further adjust its workforce. This announcement triggered a strong market response, causing Bosch Group's share price to decline.

In recent years, Bosch Group has been conducting layoffs globally to address industry challenges and economic conditions. Earlier this year, the company announced job cuts of around 1,000 employees worldwide, mainly affecting its automotive supply and tool divisions. The latest round of layoffs impact over 7,000 jobs in Germany, primarily concentrated in the automotive supply sector, with additional cuts affecting the tools division and BSH subsidiary responsible for home appliances.

Stefan Hartung pointed out that Bosch Group is facing weak order intake and subpar performance due to the global economic slowdown and the slow adoption of electric vehicles in Europe. Particularly, the automotive and intelligent transportation business, Bosch's largest revenue generator, accounts for 60% of the group's revenue but boasts the lowest profit margin. Although Bosch Group's revenue reached nearly 92 billion in 2023, the projected sales return rate for this year is expected to be 4%, lower than the 5% achieved in 2023. The company aims to reach a 7% sales return rate by 2026, but achieving this target currently appears challenging.

Faced with the dual pressure of current economic challenges and industry transformation, Bosch Group has been forced to implement layoffs. These job cuts impact not only software developers but also management and sales personnel associated with related businesses. Bosch Group is considering transferring some employees to other departments or utilizing early retirement and voluntary severance programs to mitigate the social and economic repercussions of direct layoffs.

Bosch Group is a leading global supplier of automotive components, specializing in automotive electronics, safety systems, powertrain technologies, and more. In recent years, the company has been actively transitioning, aiming to secure a leadership position in autonomous driving and electric vehicles. However, the global economic downturn and the decline of the traditional automotive industry have presented Bosch Group with significant challenges.

This round of layoffs is undoubtedly a measure taken by Bosch Group to cope with the economic downturn. However, it also reflects the transformative challenges faced by the global automotive industry. With the rapid development of electric vehicles and autonomous driving technologies, the traditional automotive sector is undergoing significant transformation. Automotive component suppliers like Bosch Group need to adjust their strategies promptly to remain competitive in this new landscape.

Bosch Group's layoffs serve as a warning to other companies. Amidst the global economic downturn and industry transformation, businesses need to operate more rationally and prepare for risk. Looking ahead, companies must prioritize innovation and transformation to survive and grow in this fiercely competitive market.

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