Voith CEO Dirk Hoke Announces Plan to Cut 2,500 Jobs Amid Company Restructuring

Dirk Hoke, the new CEO of the German engineering company Voith, has unveiled a significant restructuring plan aimed at stabilizing the company after years of financial difficulties. In a statement from Voith’s historic Villa Eisenhof headquarters in Heidenheim, Hoke outlined intentions to cut approximately 2,500 jobs globally, predominantly in Germany, to secure the firm's future competitiveness.

Voith has struggled with declining revenues and profitability over the past decade and a half. For the fiscal year 2023/24, the company reported revenues of 5.23 billion euros but faced an operational loss of 247 million euros. Hoke acknowledged, “We must acknowledge that we have not performed as well as our competitors,” emphasizing the need for urgent and difficult measures, including job reductions and operational streamlining.

Central to Hoke's restructuring strategy is addressing inefficiencies and high bureaucratic overhead within the company. He pointed out the imbalance of direct to indirect employees and highlighted Voith’s current production setup concentrated in high-cost countries, necessitating a shift toward manufacturing in lower-cost regions such as North America and Asia.

Looking ahead, Hoke identified three key growth areas for investment: industrial water treatment, recycling, and heat recovery technologies, leveraging Voith’s existing expertise while planning to divest from truck and bus drive systems to refocus the company’s portfolio.

The workforce, represented by IG Metall, agrees on the need for growth and innovation but remains cautious about the planned job cuts. The union has urged the company to explore all possibilities to retain jobs and minimize layoffs.

This comprehensive restructuring reflects Voith's efforts to adapt to a changing global industrial landscape, especially in the face of rising competition from innovative nations like China. The company's future now hinges on balancing cost efficiency with targeted investment in growth sectors while managing the social impact of workforce reductions.