BASF plans further cuts at Ludwigshafen complex
by ChemOrbis Editorial Team - content@chemorbis.com
BASF plans to cut €1 billion in annual expenses at its headquarters in Ludwigshafen by the end of 2026, the company said in a press release. BASF attributed this decision to the higher production costs and sluggish demand in both upstream and downstream businesses in Germany, which affected the financial results of the company.
The company experienced a 21.1% decline in sales and 60.1% decline in adjusted earnings in 2023 compared to the previous year.
The new cost-cutting program will affect both production and non-production areas, with a focus on aligning capacities with market demands, given the site’s low plant operating rates.
This initiative marks the third cost-reduction effort by BASF in Germany in recent years at the complex. BASF’s board will assess the long-term positioning of the Ludwigshafen site as market realities change in Europe and Germany. More details on this plan are expected in the second half of 2024.
The Ludwigshafen complex houses two naphtha-fed steam crackers, with combined ethylene capacity of 680,000 tons/year and propylene capacity of 380,000 tons/year.
The company experienced a 21.1% decline in sales and 60.1% decline in adjusted earnings in 2023 compared to the previous year.
The new cost-cutting program will affect both production and non-production areas, with a focus on aligning capacities with market demands, given the site’s low plant operating rates.
This initiative marks the third cost-reduction effort by BASF in Germany in recent years at the complex. BASF’s board will assess the long-term positioning of the Ludwigshafen site as market realities change in Europe and Germany. More details on this plan are expected in the second half of 2024.
The Ludwigshafen complex houses two naphtha-fed steam crackers, with combined ethylene capacity of 680,000 tons/year and propylene capacity of 380,000 tons/year.
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