Rhein Chemie takes measures to counter crisis
Friday, 06. February 2009 Rhein Chemie, a wholly owned subsidiary of specialty chemicals group LANXESS, is to participate in the Group’s global “CHALLENGE 09” package of measures in order to soften the impact of the global recession on the company. The package that has already been instigated comprises a large number of structural improvements and personnel measures.
Rhein Chemie, a wholly owned subsidiary of specialty chemicals group LANXESS, is to participate in the Group’s global “CHALLENGE 09” package of measures in order to soften the impact of the global recession on the company. The package that has already been instigated comprises a large number of structural improvements and personnel measures.
“Many of our important customers, such as automotive suppliers, have been experiencing a dramatic fall in demand for some time,” says Dr. Anno Borkowsky, Managing Director of Rhein Chemie Rheinau GmbH, commenting on the situation. “What’s more, orders are not expected to increase significantly in the immediate future.” Rhein Chemie had already responded to the economic crisis with temporary shutdowns at the end of last year. The employees also made use of flexible working hours or took unused vacation days.
In constructive negotiations with employee representatives and the IG BCE union, the following main points were agreed on for non-managerial employees of Rhein Chemie in Germany:
- Effective March 2009, a 35-hour week with a corresponding reduction in salary will be introduced for a period of 2 years
- Reduction in the collectively agreed annual supplementary payment (Christmas bonus) from 95 to 50 percent of gross monthly salary in 2009
These measures are still subject to the approval of the relevant bodies.
The following measures are planned for managerial employees of Rhein Chemie in Germany:
- Adjustment in variable compensation payments for 2009
- The review of managers’ base salaries planned for 2009 will be postponed by at least six months
In addition to these measures, sales structures at headquarters in Mannheim are to be geared more strongly to the change in customer structure, service units are to be reorganized and the current shift model is to be modified in one production area. The purpose of this is to lower cash outs by a single-digit million euro amount. These measures are part of LANXESS’s global “CHALLENGE 09” package. In addition, headcount is to be adjusted by up to 40 employees in the course of the reorganization. The management will work with the employee representatives to find socially responsible solutions for the employees affected. All measures are scheduled for completion by 2011.
“With these measures we are responding quickly and effectively to the drop in business,” says Borkowsky. “We are aware that the decisions represent painful cuts. However, they are an unavoidable part of the package if we want to strengthen Rhein Chemie further in the future.” The employees have already been informed about the measures at a special meeting.
At its headquarters in Mannheim, Rhein Chemie produces additives for the rubber, lubricants and plastics industries. The automotive industry is its biggest market.
Rhein Chemie is a company with a successful track record in customized additives and service products stretching back over 100 years. The approximately 850-strong workforce produces and sells products for various sectors of the rubber, lubricants and plastics industries worldwide. Some 500 people are employed at its headquarters in Mannheim-Rheinau. The company has subsidiaries and production facilities in Europe, Asia and North and South America. Rhein Chemie posted sales of around EUR 210 million in the first nine months of 2008.
Mannheim, 06. February 2009
This company release contains certain forward-looking statements, including assumptions, opinions, expectations and views of the company or cited from third party sources. Various known and unknown risks, uncertainties and other factors could cause the actual results, financial position, development or performance of LANXESS AG to differ materially from the estimations expressed or implied herein. LANXESS AG does not guarantee that the assumptions underlying such forward-looking statements are free from errors nor does it accept any responsibility for the future accuracy of the opinions expressed in this presentation or the actual occurrence of the forecast developments. No representation or warranty (expressed or implied) is made as to, and no reliance should be placed on, any information, estimates, targets and opinions, contained herein, and no liability whatsoever is accepted as to any errors, omissions or misstatements contained herein, and accordingly, no representative of LANXESS AG or any of its affiliated companies or any of such person's officers, directors or employees accept any liability whatsoever arising directly or indirectly from the use of this document.