The Supervisory Board also instructed the Executive Board of ThyssenKrupp AG to draw up an overall plan on the basis of the new Group structure, taking into account the rights of the employee representatives, before the Supervisory Board meeting on May 13, 2009 and to present this plan to the Supervisory Board for resolution. The new Group structure is to be implemented legally and organizationally as quickly as possible and by no later than October 1, 2009, subject to required approvals by the Supervisory Board for individual measures.
In the meantime the general economic situation has continued to deteriorate significantly. The leading economic institutes and the German government are now forecasting a decline in growth of up to six percent. This dramatic collapse is now also impacting all areas of our Company. ThyssenKrupp will report on its performance in the first half of the fiscal year on May 13.
Since November, ThyssenKrupp has taken various measures to provide a systematic and measured response to the crisis and secure liquidity and earnings. The focus is firstly on cost-cutting measures, which are being implemented under the Groupwide ThyssenKrupp PLuS program with a view to achieving savings of well over €1 billion in the current fiscal year. In addition, ThyssenKrupp is improving its cash position by optimizing its net working capital and making adjustments to its capital expenditures.
The massive economic downturn makes it necessary to further develop the strategic reorganization plan outlined in the Supervisory Board meeting on March 27 with cost savings of up to €500 million. Executive Board Chairman Ekkehard Schulz: “We are firmly convinced that we must use the current crisis as an opportunity to put ThyssenKrupp in a strong strategic position for the future. We need to become leaner, better and faster so that we can operate closer to the market and implement operational and strategic measures more directly.”
Against this background, the Executive Board of ThyssenKrupp AG has decided to further develop the present model: In the future ThyssenKrupp is to be efficiently managed and steered by a strong corporate center. The eight new business areas Steel Europe, Steel Americas, Stainless Global, Materials Services, Elevator Technology, Plant Technology, Components Business and Marine Systems are to be tied directly to ThyssenKrupp AG in the future. The divisions as interim holding companies will no longer be needed. This new structure will bring the Group Executive Board closer to business operations. It will create greater transparency both internally and externally and permit faster and better decision-making. The current segment holding companies will be absorbed into the new structure. This consolidation will significantly reduce administrative expense and capacities. “Materials” and “Technologies” describe the strategic focus of the business areas and mark out the ThyssenKrupp Group’s areas of competency.
Details of the further developed strategic reorganization plan will be presented to the Supervisory Board for discussion and resolution on May 13. The plan also addresses the issues raised in the Supervisory Board meeting of March 27 regarding codetermination structures, which are the subject of ongoing discussions with the codetermination bodies.