ZKW in Wieselburg: Despite innovations, massive job cuts threaten!

ZKW in Wieselburg: Despite innovations, massive job cuts threaten!

Wieselburg, Österreich - The situation with the Austrian car supplier ZKW in Wieselburg remains tense. Despite a number of new patents and innovations, there is noticeable pressure on the workforce. ZKW, a subsidiary of the South Korean LG group, reported impressive 38 patents at the European Patent Office last year. The company not only occupies first place in the patent ranking in Lower Austria, but is also in eighth place across Austria. The innovative products include a new headlight with a light guide and an interchangeable covering window that should help to make vehicle designs more flexible and increase safety in road traffic. Nevertheless, the mood is pressed in the face of the continuing challenges in the auto industry.

The restructuring measures that started in 2023 will take effect and are to take around 600 jobs by the end of 2024, especially in the form of temporary workers. Pension exits and voluntary dismissals remain without replacement, which also affects the situation for the remaining 2,000 employees at the Wieselburg plant. CEO Wonyong Hwang expressed that saving measures were essential in view of the difficult market situation in the automotive industry. In order to make the layoffs socially acceptable, the company management and works council have agreed to extend the social plan, but there are no specific information on further measures.

challenges for the automotive industry

The situation of ZKW reflects the generally difficult situation of the automotive industry. The German auto industry in particular faces massive challenges. The sales of combustion vehicles in China, the most important market, weakens, while German manufacturers lose market shares in Chinese companies in the electric car segment. The turnover of the German automotive industry achieved a new maximum value in 2023 with over 564 billion euros, but the general transfer of demand from combustion to electric vehicles causes difficulties.

The German supplier industry is also affected because profit margins have dropped and many companies have to take measures such as job cuts. While suppliers have traditionally focused on combustion technology, they now show a growing interest in areas such as software development and battery production. In 2023, the Chinese manufacturer Catl became the second largest automotive supplier in the world after sales. German manufacturers such as Volkswagen are increasingly investing in research and development for innovative technologies, including battery technology and autonomous driving, in the hope of securing their market position.

The European manufacturers are also faced with strict CO₂ requirements, and the impending ban on combustion in the EU from 2035 represents another hurdle. Many of the large companies, including Ford and the Renault-Nissan Mitsubishi Group, have only briefly met their specifications for 2023, which also increases the challenges within the industry. ZKW not only has to deal with internal difficulties, but is also part of a greater development in the automotive industry, which is currently in change.

OE24 to compensate for the impending job cuts. The entire industry is required to adapt to the changing conditions.

For a detailed analysis of the current trends and challenges in the automotive industry, the platform Statista