Czech Republic: the automobile crisis will be more serious than anticipated

Skoda Auto. The Czech Republic’s biggest exporter is to scale down operations by three percent due to a sharp decline in demand, the company announced last week. This would result in nearly 870 layoffs – about 3 percent of Skoda Auto's workforce. Besides, the company management agreed with trade unions on a shutdown for nearly a month at the turn of the year, from December 19 to January 12. Skoda Auto has already parted with agency workers (almost 1.500 since September), usually foreign workers. The management also agreed with unions on a measure to prevent layoffs: production will be limited to 4 workdays a week from January to June 2009. Employees will receive 75 percent of their average wage during the shutdowns. Moreover, they will get a daily bonus of CZK 50 (€1.90) in February.
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e and glass industry. For the moment, the sector hit by the crisis the most is the automotive industry. According to a report of the Association of Automotive Industry published last week, domestic carmakers and their suppliers will release over 13.500 employees by July 2009. About 7.000 of them should be permanent staff. Redundancies will mainly affect supply companies, but also carmakers Skoda Auto and TPCA (Toyota Peugeot Citroën Automobile).

Skoda Auto. The Czech Republic’s biggest exporter

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