Feintool, a Swiss automotive supplier, said on December 2 that it would close one of its plants in Germany and lay off up to 200 people due to weak demand for electric vehicles and uncertainty about the transition to renewable energy.
Feintool plans to reorganize the production of motor rotors and stators and announced that it will close the unprofitable plant in Sachsenheim near Stuttgart, while moving most of the production to the Tokod plant in Hungary.
In its stamping business unit, Feintool will focus on electrical lamination stamping. The research and development and tool making center and automated automotive production will be concentrated in Vaihingen near Sachsenheim.
Feintool said that the business adjustments will be negotiated with workers’ representatives and 250 of the current 450 jobs in Sachsenheim and Vaihingen will be retained.
Feintool said the changes will boost performance in the stamping business unit and are expected to save 15 million Swiss francs a year in the medium term once the relocation is complete.
German carmakers and suppliers are facing weak demand, high production costs, competition from Chinese rivals and a slower-than-expected transition to electric vehicles. Companies such as Volkswagen and parts supplier Bosch are seeking to restructure and cut costs.
The Munich-based Ifo institute said confidence in the automotive industry was deteriorating rapidly due to weak demand, with indicators for the industry falling again in November.
Feintool said the difficulties at the Sachsenheim plant were mainly caused by external economic factors and the current situation in Germany. The company said its plant in Jessen, Saxony-Anhalt, would also be affected by the restructuring, but to a lesser extent.
Feintool said political uncertainty in electric vehicles, the transition to renewable energy and the economic downturn in the industrial business were factors behind the business changes.