Autoliv, the leading global manufacturer of airbags and seatbelts, has announced its plans to expedite cost-cutting measures, primarily in Europe. The Swedish company aims to reduce its workforce by 11 percent, amounting to approximately 6,000 jobs. The cost-cutting initiatives include the closure of various European sites, with a target of implementing these measures fully by 2025.
In a statement released on Thursday, Autoliv emphasized the optimization of its geographic footprint and the streamlining of operations across all areas. CEO Mikael Bratt stated that the company intends to simplify and consolidate its operational structure for greater efficiency.
The surge in raw material prices has severely impacted auto suppliers, including Autoliv. The company previously highlighted the unprecedented cost inflation experienced in 2022, describing it as the most severe in three decades. Autoliv has been actively engaged in negotiations with its customers to pass on the increased costs and address structural pricing discrepancies.
Bratt acknowledged that customer negotiations in Europe are the highest priority and most significant challenge for the company. The automotive supplier continues to work towards securing pricing agreements that reflect the extraordinary inflation and rectify price gaps in the market.
Autoliv, competing with industry rivals such as ZF and Joyson Safety Systems, reaffirmed its full-year outlook, initially provided in April. The company projects a widening of its adjusted operating margin to approximately 8.5 to 9.0 percent.
According to the Automotive News Europe list, Autoliv ranked 30th among the top 100 global suppliers, with worldwide sales to automakers totaling $8.2 billion in 2021. As Autoliv moves forward with its cost reduction strategies and organizational optimization, the company aims to navigate the challenges posed by rising costs and maintain a strong market position in the automotive industry.
