As of: February 8, 2024, 6:35 p.m
By: Lars-Eric Nievelstein
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Just a few days ago, the household appliance manufacturer Miele announced that it wanted to cut 2,700 jobs.
A move of production to Poland is also planned.
But why is that?
Gütersloh – 500 million euros: This is how much money Miele hopes to get from the recently announced savings measures.
Among other things, part of the washing machine production will take place in Poland instead of in Gütersloh, and up to 2,700 jobs will also be affected by conversion or reduction.
Sales had recently fallen, as had the number of units sold - and in double digits.
There are mutliple reasons for this.
Positions affected by Miele's renovation program |
2,700 maximum |
|---|---|
Production decline for electrical and digital industries in 2024 |
2 percent (forecast) |
Decrease in the number of units sold at Miele in 2023 |
18 percent |
Long Covid at the Miele Group
One of the reasons for this lull is the coronavirus pandemic - but not because of quarantine or operational shutdowns.
On the contrary.
“Under the changing circumstances of the pandemic, the Miele Group’s business performance was like a proverbial roller coaster ride,” the company announced in February 2021.
The company suffered declines between March and May, but then there were “catch-up effects” in the summer and an “outstanding” second half of the year.
Just a few days ago, the household appliance manufacturer Miele announced that it wanted to cut 2,700 jobs.
The “Miele Performance Program” is intended to save millions.
© IMAGO / Pond5 Images
“A pronounced boom in household appliances has provided a strong tailwind here,” explained Miele.
“People had to – and still have to – spend a lot more time at home, and instead of spending money on travel and restaurants, they invested in their four walls.” According to Wirtschaftswoche,
Miele
had built up excess personnel capacity due to this boom, but had not given it sufficient consideration , that the buying spree might come to an end.
The manufacturer simply did not manage to securely position the company for possible future crises.
Inflation meets a collapse in demand
According to Miele, the fact that there has now been a significant drop in global demand for household appliances is a key factor in the current turbulence.
The Miele Group's preliminary sales fell by around nine percent, and the number of units sold fell by around 18 percent compared to the previous year.
There is no market recovery in sight.
“What we are currently experiencing is not a temporary dip in the economy, but rather a lasting change in the framework conditions relevant to us that we have to adapt to,” explained the management of the Miele Group in an internal information to its employees.
Added to this is high inflation, which drives up material and energy costs.
In this context, Miele spoke of “drastic price increases”.
Traffic lights must stop the “regulatory tsunami”.
Miele is by no means alone with the lull in demand.
At the beginning of the year, the Association of the Electrical and Digital Industry (ZVEI) announced that the order situation was declining across the entire industry.
Last year, manufacturers benefited from “historically high” order backlogs that they were able to process, but these began to decline from the second quarter at the latest.
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For 2024, ZVEI expects a production decline of two percent.
The electrical and digital industries are facing a “slight dip in growth”.
In order to get the industry back on track in the long term, according to ZVEI President Dr.
Gunther Kegel demanded politics.
“If the EU wants to continue to play an independent role between the USA and China, it must align the internal market more consistently with growth and abandon non-industry regulations such as the EU Supply Chain Act,” said Kegel in an association report.
The traffic light coalition must stop the “regulatory tsunami” and the “almost unleashed bureaucracy” that are weakening the competitiveness of companies.
“We now need a European Union that focuses on industrial value creation,” said Kegel.
However, the traffic light has already reached that point – at least in theory.
The coalition parties are currently arguing about when the plans will become reality.