Jungheinrich Announces Major Job Cuts Amid Market Challenges

In a surprising turn of events, Jungheinrich, one of Germany's leading manufacturers of forklifts, has announced a significant reduction in its workforce, planning to cut approximately 1,000 jobs globally. This decision comes at a time when the German government is investing heavily in infrastructure, which experts had anticipated would increase the demand for material handling equipment such as forklifts.

As of the end of 2024, Jungheinrich employed around 21,000 people worldwide. The company revealed that the job reductions would impact various locations, including its facility in Lüneburg, Lower Saxony, which is set to close entirely by 2027. The spokesperson for Jungheinrich confirmed that the approximately 380 employees at the Lüneburg site have already been informed of the closure, with some employees from departments like engineering being offered new office opportunities nearby to continue their work with the company.

In Hamburg, where around 1,200 individuals are employed, the job reductions are expected to be in the double-digit range. Meanwhile, the Norderstedt plant in Schleswig-Holstein, which currently employs about 1,500 people, is also facing significant job losses, with estimates suggesting that several hundred positions could be eliminated. Jungheinrich is reportedly looking to mitigate the impact of these job cuts through a voluntary program, with ongoing discussions with employee representatives at the company's headquarters in Hamburg.

The announcement has not only affected the workforce but has also led to downward revisions in the company's financial forecasts. Jungheinrich has lowered its expectations for revenue, order intake, and profits, projecting an operating profit between 280 and 350 million euros, a significant decrease from earlier estimates of 430 to 500 million euros. The company attributes this decline to weakening markets and increased competition, particularly from lower-priced equipment manufactured in China, which poses a challenge to Jungheinrich's higher-priced offerings.

In light of these developments, the company's stock has taken a hit, reflecting investor concerns regarding the future performance of Jungheinrich. Despite the recent downturn, the stock remains above levels recorded at the beginning of the year.