MAN SE plans to halt production of heavy-duty vehicles for four weeks at two German factories as the economic downturn curbs demand from freight transporters and construction firms, company sources said.
Stoppages at MAN will affect about 15,000 workers and initially be limited to five days starting on Monday, paralyzing headquarters in Munich and another plant in Salzgitter, the two sources said on Saturday on condition they not be identified because the matter is confidential.
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Truck production will be suspended again between Dec 24 and Jan 11, the sources said, confirming an article by Sueddeutsche Zeitung which reported the stoppages earlier on Saturday.
A spokesman for MAN only confirmed the steps planned for next week, saying the company may announce more details when it publishes third-quarter earnings next Tuesday. He also confirmed that MAN plans to scale down administrative operations at its main truck and bus division from Monday.
Sources said MAN, which is owned by Volkswagen , may also limit truck production in Munich and Salzgitter to four days per week in November, though a decision hasn't been taken yet. Planned cutbacks have all been coordinated with the company's works council, they said.
MAN has said that its third-quarter group orders were lower than the second-quarter intake as the downturn in business exceeded normal seasonal patterns. MAN also makes diesel engines and turbo machinery.
The truckmaker may report that its third-quarter underlying earnings slumped 38 percent to 199 million euros ($257.34 million), a Reuters poll showed.
Registrations of new heavy trucks weighing 16 metric tons or more tumbled 14.8 percent to 18,529 vehicles across the European Union in September, extending the year-to-date drop to 7.7 percent, the European car makers' lobby (ACEA) said last Friday.
(Reporting By Andreas Cremer; Editing by Helen Massy-Beresford)