Bosch to cut 1,200 software jobs by 2026 amid rising costs and slowdown in automated driving sector
Daniel Levi
Posted On January 18, 2024
The world’s largest automotive supplier Bosch is planning to cut around 1,200 jobs in the software division by the end of 2026, 950 of them in Germany, the company confirmed in a statement with Italian Handelsblatt Daily on Thursday.
The affected employees are located in Abstatt, Hildesheim, Leonberg, Renningen, and Schwieberdingen. Bosch’s spokesperson mentioned that employees in the software division were informed about the plans yesterday. While talks with employee representatives are yet to commence, the spokesperson referred to the proposed job cuts as planned but not finalized, Handelsblatt reported.
The software division, known internally as Cross-Domain Computing Solutions and comprising around 20,000 employees, is responsible for developing self-driving cars. The main reason cited for the job cuts is the slower-than-expected progress in the development of fully automated driving, where driver intervention is no longer required.
“A weak economy and high inflation, caused among other things by increased energy and commodity costs, are currently slowing down the transition,” the company said in a statement.
Bosch management announced their intention to initiate discussions with employee representatives. Apart from software developers, the cuts will also impact administration and sales within the division, as reported by Handelsblatt.
The company also attributed the move to a weak economy and high inflation, influenced in part by increased energy and commodity costs. Bosch’s CEO, Stefan Hartung, acknowledged the challenges, stating that 2024 and possibly 2025 would be more difficult than anticipated. The company emphasized its commitment to conducting the job cuts in a socially responsible manner.
“2024 will be more difficult than expected, and 2025 probably will be too,” Bosch boss Stefan Hartung said in an interview with Handelsblatt shortly before Christmas and postponed the achievement of the planned return targets.
Bosch aims to implement the reductions through age-related and voluntary departures, fluctuations, and reductions in working hours. Notably, operational dismissals at the German locations of the car division are excluded until the end of 2027, based on a recent agreement.
In a broader context, Bosch is not the only player in the industry announcing staff cuts. On Wednesday, 3,000 employees of ZF, the second-largest German auto supplier, protested in Friedrichshafen against the board’s plans. According to the Works Council, Germany is expected to lose 12,000 jobs in total.
