Page 149 - CW E-Magazine (12-3-2024)

News from Abroad

TOUGH TIMES
BASF plans more job cuts in Germany even as profit

set to rebound

German chemicals giant, BASF,
will slash another Euro 1-bn ($1.1-bn)
in annual costs at its Ludwigshafen
headquarters, citing weak demand
and high energy costs in its home
market.
The annual cost savings will be
reached by the end of 2026, affecting
both production and administrative
activities at its largest chemical complex,
but it was set to shrink further beyond of Germany under challenging condi- weak global demand, geopolitical
that, the company said in a statement. tions. “Our teams delivered a positive uncertainty and persistently high inflation.
The total targeted annual savings is set earnings contribution in all signifi-
to reach Euro 2.1-bn by 2026. cant countries – with the exception of Ludwigshafen would remain by far
Germany. On the other hand, the nega- the group’s largest production complex,
BASF outlined the new cost cuts tive earnings at our Ludwigshafen but it would continue to shrink and shift
in annual results, which confirmed site show the urgent need for further from home-made to more imported
a decline in sales and profits set out decisive actions here to enhance our basic chemicals coming from low-cost
in preliminary earnings. The group competitiveness,” he added. regions, said Finance Chief Mr. Dirk
reported a 21 percent drop in sales to Elvermann, citing natural gas costs four
€68.9-bn and a 29 percent fall in earn- An economic downcycle in Germany to five times higher than in the US.
ings before taxes, interest, depreci- is weighing on volumes affecting
ation and amortisation and special speciality chemicals and basic petro- A year ago, BASF laid out detailed
items, to €7.7-bn. But BASF said a chemicals, BASF said. This would lead plans to close sites, slash costs and shed
recovery in industrial activity in China to more job cuts that are being dis- about 2,600 jobs in Europe, affecting
should lift earnings in its current cussed with shop stewards. “It’s serious mainly Ludwigshafen. The standing
financial year (2024), to as much as because you can really see Europe lost of BASF’s Ludwigshafen site, still the
€8.6-bn. competitiveness. But within Europe, world’s largest chemical complex run
Germany in particular lost competitive- by a single company, has deteriorated
BASF’s CEO Dr. Martin Bruder- ness,” said Dr. Brudermueller. over the years. Swapping cheaper
mueller, who will quit in April to Russian pipeline gas for shipped
become non-executive Chairman of The German government has cut liquefied gas from the United States
carmaker Mercedes-Benz, cited high its 2024 economic growth projection after Russia’s attack on Ukraine has
competitiveness of the group outside to 0.2%, from 1.3% previously, amid weakened its cost position further.

Ascend hikes prices of performance and speciality
chemicals

Ascend Performance Materials, the 0.25/kg, while the company’s branded by $0.10-$0.50/kg. FlexaTram-DAM
US-based integrated producer of nylon products – FlexaTrac-DME (dimethyl (a blend of amines) is up by $0.10-$0.50/
6,6, has increased global price increases ester) has moved up in the range of kg and the company signature brands –
of its performance and specialty chemi- $0.10-$0.25/kg and FlexaTram-BHM Hexatran and Prionil is costlier in the
cals. Adipic acid price has gone by (bis-(hexamethylene) triamine) is costlier range of $0.05 – $0.30/kg.

Chemical Weekly March 12, 2024 149

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