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27. April 2019

Supplier Nemak to cancel Shift in Linz because of BMW in Steyr

Supplier Nemak to cancel Shift in Linz because of BMW in Steyr

Because of decreasing orders from BMW's large engine plant in Steyr, auto parts supplier Nemak wants to cancel a shift at its Linz plant. Nemak specializes in so-called core production - ie high-precision casting and machining of cylinder heads for engines.


Auto supplier Nemak's Linz is feeling the decline in orders from major car manufacturers. By far the largest customer of Nemak is the large engine plant of BMW at the Upper Austrian Steyr location. A few weeks ago, the Bavarian manufacturer cut a shift there because the demand for diesel cars has recently dropped in the wake of the emissions scandal.

Nemak: Specializing in high-precision cylinder heads
Nemak specializes in high-precision casting and machining of aluminum cylinder heads. Now Nemak wants to react to the development at BMW with the cancellation of a shift in his plant in Linz, as the "Upper Austrian News" reports. This is expected to happen in June.

Around 40 of the 520 employees will be laid off, confirms Managing Director André Gröschel the newspaper. Over the past few weeks, 40 temporary employees have been sent away and vacations reduced - these "buffers" are now gone. Accordingly, the next reduction in the summer will also affect permanent staff.

Until 2002 an Austrian manufacturer
Nemak was formerly an Austrian company and was called Mandl & Berger. In 2002, the Norwegian Hydro Aluminum Group bought the manufacturer and sold it five years later to the Mexican group Nemak, which operates 37 locations worldwide. The plant in Linz has to compete with locations in Eastern Europe within the group, where, as we know, much lower wages are paid. Therefore further cuts are necessary, according to Gröschel.

BMW Steyr: Again optimistic
At BMW in Steyr, on the other hand, they are feeling a bit more optimistic: new generations of engines are expected to replenish capacity from summer. Gröschel, on the other hand, tells the newspaper: "There's nothing for us here."

Nemak Linz: "I'm not worried about the location"
A major advantage of the Linz plant is the recently expanded development center, which works for all plants of the Mexican manufacturer. Managing Director Gröschel says that the first series will only be produced where it is developed: "In that respect, I am not worried about the location."

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