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Uncertain economic situation has pushed Scania to cut thousands of jobs
Tuesday, 20 December 2011
Truck manufacturer Scania pulls down on production further as the economic situation continues to constrict demand.

Approximately ten percent of the temporary workers will not have the chance for their contracts to be extended. This will be approximately 100 people, working in Södertälje, which is the only Swedish factory concerned, according to Scania's press Officer Hans-Ake Danielsson.

This is the second time since November 2011 that Scania has put down the rate of production with reference to reduced demand. When asked if the company expect the declines to continue Danielsson responded that:
“You just have to be prepared for worst-case scenario.” But concerning the permanent jobs, he said that “No, not at this time. We do not have any such plans. If we find that our situation  fall further, then we invest in skills development.”

From January the company lowered the rate of production at factories in Europe and Latin America. Just over a thousand temporary workers will not have their contracts renewed, according to a press release from the company.

When Scania reduced the rate of production in November, 900 of 1,400 temporary workers in Europe had to be release. Since then, demand has deteriorated further, according to company management.

"The slowdown in Europe and the Middle East has continued, while we also see a lower rate of orders from other markets," writes Martin Lundstedt, head of Scania's sales and marketing, in the press release.

Scania's share price before the news had risen by a few percent, but immediately turned down when the press release was published. By closer to late in the afternoon, its share had fallen by  1.4 percent while the Stockholm Stock Exchange, the  OMXS index on the whole had risen by 0.5 percent.

The decline in demand is particularly evident in the indebted countries of southern Europe, according to Hans-Ake Danielsson.
“If you talk of Europe, it is mostly the south. But there is a general slowdown in all our markets. Uncertainty had increased. And there is uncertainty about economic developments, which also reduces the interest in investing.
By scancomark.se Team

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