- Mercedes-Benz said it will cut redundant roles in China, and consolidation of the business will inevitably involve some staff.
- A local media report yesterday said Mercedes-Benz China was laying off about 15 percent of its workforce.
German luxury carmaker Mercedes-Benz has confirmed it is making job cuts in China, after rumors began circulating yesterday.
Mercedes-Benz China will consolidate and cut redundant and duplicated positions, and the consolidation in business will inevitably involve some employees' work schedules, local media Guancha quoted the carmaker as saying today.
In the face of a challenging market environment and transformational opportunities in the automotive industry, Mercedes-Benz has been actively restructuring its business to improve operational efficiency and market competitiveness, it said.
This includes optimizing and streamlining business processes and organizational structures to keep the company's operations resilient, Mercedes said.
Yesterday, local media outlet AutoPix reported that Mercedes-Benz China initiated layoffs on February 26, with a ratio of about 15 percent.
This round of layoffs mainly involves sales and auto finance business, and the research and development business has not been affected for the time being, according to the report.
The laid-off employees will receive compensation equivalent to N+9 months' salary, AutoPix said. N representing the number of years they have worked at Mercedes-Benz.
If the laid-off employees don't join a new company in the next two months, Mercedes-Benz China will pay additional wages for March and April, according to the report.
The compensation offered by Mercedes-Benz is generous among layoff moves by foreign car companies. Last October, Volkswagen China initiated layoffs, offering compensation of up to N+6; last April, Tesla China's layoff compensation was N+3, the report noted.
In its response today, Mercedes-Benz denied that it's offering N+9 compensation, but said it would act responsibly and offer the employees involved a package that was as reasonable as possible.
Mercedes-Benz's earnings report released on February 20 showed it posted revenues of €145.6 billion ($152.5 billion) in fiscal year 2024, down 4.46 percent year-on-year. Earnings before interest and taxes (EBIT) were €13.6 billion, down 30.96 percent year-on-year.
($1 = EUR 0.9542)
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