German Energy Giant RWE to Eliminate 6,750 Jobs
Essen, Germany (dpa) - German energy giant RWE AG said Thursday it would cut 6,750 jobs, about 10 per cent of its workforce, by 2016 because of declining profits.
RWE would eliminate some of the jobs by selling subsidiaries, chief human resources officer Uwe Tigges said during a conference call with analysts. Of the jobs earmarked to go, 2,000 are outside Germany. RWE, which is one of the top four German electricity generators, blamed the job cuts on sagging earnings, saying it had lost money on about a third of the electricity it generates.
Cows are standing in front of the latest coal-fired power station of German power provider RWE on Thursday, Nov. 14, 2013 in Hamm, Germany. The international energy giant announced to cut about 10 percent of all jobs worldwide, 4700 in Germany. The profit of RWE decreases because of the German energy transition towards renewable energies. (AP Photo/Martin Meissner)
A government directive to gradually cease use of nuclear power and rely on a mix of fossil fuels and renewable energy has shaken up the German electricity business. ”This company is going through a vale of tears,” chief executive Peter Terium said. The planned cuts would eliminate 1 billion euros (1.3 billion dollar) in annual expenditures. The workforce would fall from about 67,400 globally at the end of 2013 to 61,000.
Two major German unions, Verdi and IG BCE, voiced anger at the cost cutting, which is to include pay limits on those who keep their jobs. The company would try to avoid compulsory redundancies through part-time work prior to retirement, natural attrition and an internal company rehiring centre. It is to sell its oilfields exploitation unit, DEA.
In late September, RWE announced a halving of its dividends and staff cuts in its electricity-generation division. It also reduced its workforce by 6,200 from 2011 to the end of 2013 through redundancies and divestments. It is also moving its billing operations to Poland to take advantage of lower pay there.
Euro Converter
