BASF, Ludwigshafen, Germany, is temporarily shutting down approximately 80 plants worldwide and reducing production at approximately 100 plants. Plants in Freeport TX and Geismar LA are among those in the decision.
"We already drew attention to the difficult economic situation at the end of October," said Jurgen Hambrecht, chairman of the board of executive directors, said in a BASF news release. "Since then, customer demand in key markets has declined significantly. In particular, customers in the automotive industry have canceled orders at short notice."
The shutdowns will be coordinated throughout BASF’s global production Verbund and will involve all six Verbund sites in Europe, Asia, and North America, as well as other sites. Implementation of most of the measures has already started. Reduced capacities are expected to last until January 2009 for individual plants. Should the period of weak demand continue and if all other flexible working time models have been exhausted, the company cannot rule out the need for short-time working at individual sites worldwide, BASF said.
Worldwide, approximately 20,000 employees will be affected by the production cuts. Flexible working time arrangements will be used wherever possible. The adjustments are primarily being carried out in units that supply the automotive, construction, and textile industries. Value chains affected include ammonia, styrene and polyamide, which manufacture precursors for engineering plastics, coatings, and fibers.
BASF will continue to follow market developments very closely and will adjust production planning accordingly.