Scania cuts jobs and investment

Now Reading:

Scania cuts jobs and investment

Text size Aa Aa

A slowdown in truck orders has led Scania to cut jobs and delay investment in the business.

The Swedish lorry maker saw a boom in demand in 2010 and early last year as the global economy picked up, but the European debt crisis and the Arab Spring hit profits in the latter part of 2011.

As a result production has been cut back and 1,900 temporary staff will not have their contracts extended.

“The outlook for 2012 is difficult to assess, especially in Europe in light of the economic policy problems in the eurozone,” Chief Executive Leif Ostling said in a statement.

Southern Europe had a lower level of orders throughout the second half compared with the first half while northern Europe was “somewhat weaker” in the fourth quarter.

In the Middle East, where popular revolts have overturned some authoritarian governments, orders decelerated significantly during the second half, compared with the first half, to a very low level in the fourth quarter.