Schaeffler announces further performance improvement program

Automotive industry crisis in Europe requires further countermeasures and structural adjustments Performance improvement program focuses on eliminating overcapacity, lowering personnel costs, and reducing complexity Reduction of 3,460 positions in Europe, including approximately 2,660 in Germany; closure of four locations in Germany; solidarity contribution across all hierarchical levels Clear commitment to Germany as a business location, with a focus on competitiveness and cost efficiency Realization of approximately 300 million euros in annual earnings improvement effects starting in 2030, one-time expenses of approximately 480 million euros Socially responsible implementation in consultation with employee representatives The “Motion Technology Company” strategy will continue to be consistently implemented, with cross-sector diversification and new growth areas viewed as opportunities.

Following the completion of the restructuring measures announced in November 2024 and the conclusion of 1,800 partial retirement agreements in early October, the Board of Managing Directors has decided to launch another performance improvement program. The program’s goal is to reduce overcapacity, adjust development capacity, lower personnel costs, and reduce organizational complexity.

The company is thus responding to the persistently challenging environment in the automotive industry, which – amid an overall downturn in the market and intensifying competition – is characterized by weakened demand for internal combustion engine vehicles and a delayed ramp-up of electric mobility. Added to this are the above-average costs per employee in Germany and the high complexity of the organization, with too many management levels and overly limited delegation of leadership responsibilities.

Workforce reduction – Focus on Germany and Europe
As part of the program’s implementation, a net total of 3,460 positions are to be reduced in the Europe region. Approximately 50 percent of the positions affected are in production, 30 percent in research and development, and 20 percent in other functional areas. The cuts will affect 16 locations in the Europe region. The plans include the closure of five sites, four of them in Germany.

These include the plant in Dortmund, which currently employs 430 people, and the Morbach site with 160 employees; both belong to the Powertrain & Chassis division and manufacture products for internal combustion engines.

In addition, plans are in place to discontinue operations at the Berlin site, which currently employs about 270 people, and to close the Schwalbach site. A large portion of these approximately 385 employees is expected to transfer to the Schaeffler site in Frankfurt. In total, around 190 positions will be affected by the reduction.

In addition, plans have been made to discontinue toolmaking operations at the Höchstadt site and to make adjustments to special machinery manufacturing at the Erlangen and Schweinfurt sites. Furthermore, capacity and structural adjustments are planned at other locations in Germany – including Herzogenaurach, Bühl, Höchstadt, Nürnberg and Regensburg.

Outside Germany, production and development capacities at the French locations in Haguenau and Toulouse, as well as at the locations in Skalica and Kysuce in Slovakia, are to be adjusted. The Herstal production site in Belgium, with approximately 15 employees, will be closed. Detailed information regarding the plans at the respective locations will be presented at local staff meetings.

The planned reduction of 2,660 positions in Germany means that, relative to the core workforce – which consisted of 31,957 employees as of September 30, 2026 – approximately nine percent of existing positions will be reduced by 2028. When taking into account the job reductions resulting from legacy programs and the 1,800 partial-retirement agreements already signed, the percentage mentioned above increases to approximately 18 percent.

Solidarity contribution – Across all hierarchical levels
The job cuts, which are primarily aimed at adjusting overcapacity in production as well as in research and development, will be supplemented by a solidarity contribution, that is intended to include, among other measures, a temporary, voluntary compensation reduction – still to be worked out in detail – starting with the Board of Managing Directors and extending across all hierarchical levels. The solidarity contribution aims to lower costs per employee, thereby reducing the necessary job cuts and the associated one-time expenses. It is expected to provide immediate relief to the income statement in 2027 and 2028. Without the solidarity contribution, the job cuts would have been even more extensive.

Commitment to Germany as a business location – Focus on competitiveness and cost efficiency
With this program, the Board of Managing Directors is reaffirming its commitment to Germany as a business location. Klaus Rosenfeld, Chief Executive Officer of Schaeffler AG, comments: “With the performance improvement program announced today, we want to demonstrate that, despite the challenging operating environment, it is both possible and sensible to develop and manufacture in Germany and Europe in a way that is competitive and cost-efficient over the long term. This requires that we consolidate locations, bundle technological expertise in selected regional clusters, and optimize costs per employee. At the same time, we intend to further streamline the organization and reduce hierarchical levels. The most important element of the program – also in comparison to previous programs – is the solidarity contribution, which is intended to include, among other measures, a temporary compensation reduction across all hierarchical levels.”

In implementing the program, which primarily concerns the Schaeffler Group’s automotive OEM business spanning multiple divisions, the company benefits from its broad portfolio, which is defined as part of its strategic development toward becoming the leading Motion Technology Company. On this basis, at least a portion of the job reduction is to be offset by creating positions in new growth areas.

Dr. Jochen Schröder, Chief Operating Officer at Schaeffler AG, adds: “In addition to our focus on further developing our core business, the Schaeffler Group has promising growth opportunities in future-oriented fields, particularly in the areas of humanoid robotics and defense. Here, we can draw on the technological expertise we have developed in our core business.”

Results improvement effect – 300 million euros per year starting in 2030
The performance improvement program is expected to generate savings of approximately 300 million euros per year by 2030. One-time expenses are expected to amount to approximately 480 million euros. The majority of this amount is to be recognized as restructuring provisions as early as 2026.

Socially responsible implementation – Dialogue with employee representatives
As in previous programs, the planned measures are to be implemented in a manner that is as socially responsible as possible and in close dialogue with employee representatives and works councils at the affected locations. The basis for this is our Future Accord concluded in 2018. The implementation of the structural measures is primarily scheduled for 2027 and 2028. Dr. Astrid Fontaine, Chief Human Resources Officer at Schaeffler AG, says: “As a family-owned company, it is particularly important to us that we implement the necessary measures in a socially responsible manner and in close dialogue with employee representatives. We have repeatedly found good solutions together in the past, and we want to build on that. We invite our employees to contribute constructively and actively support the necessary transformation.”

Motion Technology Company strategy – New growth areas as an opportunity
The performance improvement program announced today is in line with Schaeffler’s strategic direction – announced at the time of the Vitesco acquisition – to become the leading Motion Technology Company and to tap into new business areas based on its strong technological expertise and innovative strength. Klaus Rosenfeld adds: “Based on our strategic goal of becoming the leading Motion Technology Company, we view the Schaeffler Group’s broad cross-sector diversification as an important opportunity. We will do everything in our power to tap into new growth areas and, as far as possible, replace declining activities with new business.”

Forward-looking statements and projections
Certain statements in this press release are forward-looking statements. By their nature, forward-looking statements involve a number of risks, uncertainties, and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties, and assumptions could adversely affect the outcome and financial consequences of the plans and events described herein. Schaeffler assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. Recipients of this press release should not place undue reliance on forward-looking statements, which only reflect the situation as of the date of this press release. Statements contained in this press release regarding past trends or events should not be taken as representation that such trends or events will continue in the future. The cautionary statements set out above should be considered in connection with any subsequent written or oral forward-looking statements that Schaeffler, or persons acting on its behalf, may issue.

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