MAN Energy Solutions Launches Program for the Future

July 23, 2020
   The executive board of MAN Energy Solutions is launching a comprehensive 
  program to ensure the future viability of the company. Extensive cost-cutting and 
  restructuring measures are the necessary next steps on the way to the company’s 
  transformation into a solutions provider for sustainable energy supply. In addition, 
  the company is preparing for a prolonged period of stagnant sales as a result of the 
  Covid-19 pandemic.
  To achieve this, the company plans to cut its costs by 450 million euros and 
  increase its operational flexibility, among other objectives. The aim is to achieve an 
  operating margin of 9% and improve the company’s cash and liquidity position by 
  2023, even taking the global economic impact of COVID-19 into account.
  Adapting and optimizing the production network with a focus on core value creation 
  and greater flexibility is a key component of the program. In this context, the 
  company intends to halt steam turbine production in Hamburg and is also 
  considering closing the production facility in Berlin and relocating production 
  currently conducted there to another site. 
  The program will also focus on reducing the cost of materials and equipment, 
  optimizing the service network, streamlining the product range, cutting costs within 
  the group functions, and focusing research and development on next-generation 
  technologies.
  “We need to prepare ourselves for a market environment that will remain difficult
  for a long period of time,” said Dr. Uwe Lauber, CEO of MAN Energy Solutions. 
  “Some of the company’s key areas of business, such as the cruise ship business, 
  have been directly affected by the economic impact of the COVID-19 pandemic 
  and we do not expect to see a recovery to precrisis levels until 2023. The program 
  is designed to address these negative market influences and make lasting 
  improvements to MAN Energy Solutions’ ability to respond to market fluctuations.
  We have already begun to combat negative market influences in recent years and, 
  as a result of the measures we have introduced, we have achieved and even 
  exceeded our revenue targets. In terms of earnings, however, we haven’t yet 
  reached our goal. Therefore, increasing our profitability and improving our 
  competitive ability are key to continue successfully implementing our strategy for 
  the future.”
  MAN Energy Solutions announced its new strategy in 2018, which describes the 
  company’s transformation from a component supplier to provider of sustainable 
  energy solutions. These new solutions are expected to account for 50% of its 
  business by 2030.
  Augsburg, July 22, 2020
  Strong Focus on Fast Implementation
  The executive board expects that the implementation of the program will result in 
  the elimination of up to 3,000 positions in Germany and 950 abroad. This reduction 
  in the workforce will be carried out in a socially responsible manner as far as 
  possible, although compulsory redundancies cannot be completely ruled out. 
  The executive board has initiated talks with the works council regarding the 
  program and the associated effects on employees. “In the light of the effects the 
  Covid-19 pandemic has on our target markets, we must act fast”, says Martin 
  Rosik, Board Member responsible for Human Resources at MAN Energy Solutions. 
  “The company and the employee representatives are therefore negotiating under 
  great pressure. Our focus is on structural improvement and on reaching the cost 
  down target. We will negotiate the feasible options to get there with the employee 
  representatives in a very timely manner.”
  MAN Energy Solutions is paving the way to a carbon-neutral global economy. Whether industrial 
  production, the energy industry, or the maritime sector, we think holistically and are tackling the 
  challenges of tomorrow today – so our customers can create value in a sustainable manner. Our 
  technology portfolio contains the experience gained with a more than 250-year-old tradition of 
  engineering. MAN Energy Solutions is based in Germany and employs approximately 14,000 people at 
  over 120 locations worldwide. Furthermore, our customers benefit from the global service-center 
  network offered by MAN PrimeServ, our brand for after-sales service.