Auto industry woes force bearings maker Schaeffler to cut jobs, shares slump

FRANKFURT - German bearings maker Schaeffler said it would cut 900 jobs, shut plants and reduce its product range after its 2018 earnings slumped due to weak demand in Europe and China and it warned of a challenging few years ahead for the autos sector.

Chief Executive Klaus Rosenfeld described it as “braking and accelerating at the same time”, as the program aims to improve earnings by approximately 90 million euros, or the EBIT margin by 100 basis points, in its initial phase. Schaeffler said 2018 adjusted earnings before interest and taxes fell 13 percent to 1.38 billion euros, while revenue rose 3.9 percent. It expects revenue to grow by 1-3 percent in 2019 and sees an EBIT margin before special items of 8-9 percent.Lower growth for Schaeffler’s automotive branch in the second half of 2018 was due to weaker demand in Europe following new emissions standards and the trade conflict with the United States which hurt orders from China.

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