Voith plans to further streamline its paper machinery operations due to weak demand; 560 jobs in Austria and Germany will be axed.
German machine engineering company Voith will further streamline operations at the paper machinery division Voith Paper in order to ensure its profitability and competitiveness. The company announced on 13 September that Voith Paper will pool its competencies at individual locations and adjust its production capacities to reflect shrinking demand. The move would result in additional 560 positions being cut at different sites in Germany and Austria, the company explained. All measures are expected to be implemented by 30 September next year.
Voith blames its decision on a weak economic development and worsening conditions on the global paper market, resulting in lower demand for Voith Paper's products and services. Growth in China was noticeably slower than predicted with paper consumption forecast for 2014 being corrected downwards by 6-7% to 115 million t, Voith said. At the same time, business with machines and large rebuilds at locations in Germany and Austria continued to suffer from the structural reduction in demand in the graphic paper industry.
Voith expects the structural demand decline to continue in the coming years while investments in new paper machines will further cool off, except for tissue.
In May 2012, Voith Paper had already announced its intention to axe a total of 710 jobs in the paper segment at its German and Austrian facilities in order to adapt to new market conditions. In August 2013, the company presented another job reduction plan, resulting in a loss of 240 positions at the Heidenheim facility. Voith Paper facilities affected by the latest round of streamlining are Krefeld (210 jobs), Ravensburg (50 jobs) and Neuwied (10 jobs) in Germany and the St. Pölten (290 jobs) site in Austria.
However, Voith is not the only paper machinery manufacturer suffering from structural changes in the global paper industry. Just a couple of weeks ago, Voith's Finnish competitor Metso announced, that in addition to approximately 540 positions being reduced at the end of 2012, it was considering to eliminate another 750 jobs in the paper, pulp and power division by the end of the third quarter.