Daimler CEO Says Drastic Salary Cuts Are Coming, Warns Exec To Brace For Reductions

Daimler chief government Ola Kallenius mentioned that his firm, in addition to the automotive business as an entire, are going through painful wage cutbacks as a result of financial fallout brought on by the COVID-19 pandemic.

This case will end in carmakers having to restructure their enterprise extra harshly than they initially thought, mentioned Kallenius throughout a webcast hosted by the German producer’s primary labor union, IG Metall.

This “considerably harsher actuality” would require “drastic” wage cuts, he added, whereas additionally mentioning the truth that Daimler executives will face greater reductions than rank-and-file employees, studies Autonews Europe. These cuts are vital to guard the corporate’s monetary standing and safeguard its investments in future applied sciences, he mentioned.

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Again in April, Kallenius indicated that beforehand deliberate measures won’t be sufficient to counter the place the market was going. Proper now, Daimler, in addition to the VW Group and BMW are all bracing for second-quarter losses.

In March in the meantime, Kallenius did say that his firm’s wasn’t in need of any additional funds (through state assist), claiming that the business had “an excellent order consumption earlier than the disaster.”

One improvement plant that has already been sidetracked is Daimler’s co-op deal with BMW, which might have seen the 2 corporations co-develop subsequent technology autonomous driving and parking applied sciences. These methods ought to have made it onto passenger autos someday in 2024 and past.

Nevertheless, the 2 carmakers put their enterprise on maintain quickly to pursue particular person improvement paths.

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