The German VW supplier Bohai Trimet in Harzgerode has gone bankrupt. If the factory cannot be saved, 580 jobs will be lost after 40 years.
Another bankruptcy hits the German automotive industry. Supplier Bohai Trimet has filed for bankruptcy at its plant in Harzgerode, putting 580 jobs at risk at the important supplier to Volkswagen (VW).
On Tuesday, the factory management had to go to the local bankruptcy court. Here they requested to start insolvency proceedings. This is the German equivalent of a bankruptcy petition.
The procedure gives the company a three-month period during which management, together with an appointed trustee, must try to find a solution that can secure operations or sell the entire company.
The goal is to reach an agreement with the creditors regarding the company's debts.
If a sustainable solution is not found within the deadline, bankruptcy will become a reality. This will mean a permanent closure of the factory. All 580 employees will lose their jobs.
Curator Olaf Spiekermann has been appointed to manage the process. He visited the factory on Tuesday to speak with management and employees.
Bohai Trimet: Production and customers
"The most important task now is to keep production stable," says Olaf Spiekermann.
– We must continue to deliver our products.
However, the curator sees certain positive signs.
"I have already received positive signals from the most important customers," he adds. This gives a faint hope for the company's future, he tells the media outlet MDR .
Bohai Trimet has been producing parts for the automotive industry since 1985, but has since been sold to a Chinese owner. They have production at two factories in Germany.
It is the factory in Harzgerode in the state of Saxony-Anhalt that is now in acute danger of being closed down.
The town of Harzgerode has a long history in the metal industry. Since then, the automotive industry has also become a crucial factor for the entire region's economy.
The factory primarily manufactures body parts and gearboxes. The Volkswagen Group has been by far the largest customer over the years.
The crisis hits Harzgerode hard
The dependence on Volkswagen makes Bohai Trimet vulnerable. The large German car group is itself under financial pressure. Volkswagen has announced major cutbacks.
The group will cut around 40,000 industrial jobs in Germany alone. At the same time, production will be reduced at several factories. This will hit subcontractors hard.
Many companies in Germany are deeply dependent on orders from the major car manufacturers. When giants like Volkswagen cut back, it is immediately felt.
The automotive industry is a vital part of the economy in Saxony-Anhalt. The state has seen a wave of bankruptcies in the sector over the past six months.
Earlier this spring, Boruszew Kunststofftechnik had to turn the key. Just a month ago, Harzgerode was hit by another bankruptcy. At that time, it was the auto parts manufacturer Schlote that had to file for bankruptcy protection.
The recent bankruptcy of Bohai Trimet underscores the serious crisis in the German automotive industry. More bankruptcies could potentially follow.
The crisis in the automotive industry is affecting many actors, from the major car brands to small subcontractors.
A Chinese-owned company in the automotive industry going bankrupt is nothing new in itself. As recently as earlier this month, an entire car brand closed after 42 for the same reason. Read more about it here .
