Magna to Cut 500 Jobs in Graz, Austria in 2024 Amid Fisker Production Halt

Magna International, a contract car assembler, plans to cut 500 jobs at its plant in Graz, Austria in 2024 due to a low order book. The job cuts come after the company had already reduced its workforce by around 450 employees at the end of last year.

The decision to cut jobs is largely attributed to the turbulence at US electric vehicle startup Fisker, for which Magna is the manufacturing partner. Production of the Fisker Ocean model has been halted for an undetermined time, leading to substantial workforce reductions at Magna's Graz plant.

Fisker has faced challenges, with demand for the Ocean model not meeting management expectations in 2023. The company reported delivering over 6,400 Ocean SUVs since May 2023 but has withdrawn all financial and operational guidance for 2024. Fisker has also recently received a delisting notice from the New York Stock Exchange and started trading on the OTC market.

Why this matters: The job cuts at Magna and production halt at Fisker highlight the challenges and uncertainties faced by companies in the rapidly evolving electric vehicle industry. The impact extends beyond the companies themselves, affecting employees and local economies where manufacturing plants are located.

Magna has agreed on a social plan with employee representatives, and the first redundancies will likely take effect at the end of April 2023. The company is trying to minimize the impact on affected employees and find alternative employment opportunities for them within Magna. The province of Styria is also stepping in, working with the public employment service and social partners to find work in the region for those affected. The state government has earmarked up to an additional five million euros for the expansion of a research program on the topic of 'transformation' to help the affected employees.

Key Takeaways

• Magna to cut 500 jobs at Graz, Austria plant in 2024 due to low order book.
• Job cuts linked to production halt of Fisker Ocean model, Magna's manufacturing partner.
• Fisker faces challenges with Ocean model demand not meeting expectations in 2023.
• Magna working to minimize impact on affected employees, find alternative jobs.
• Styria government providing support, expanding research program to help affected workers.