Plans to cut approximately 7,000 jobs! Chemical giant announces large-scale streamlining and restructuring.

Notably, Evonik stated in its announcement that the annual sales of each of the two new business segments could reach around €6 billion. If the 'Customized Solutions' segment serves as Evonik’s elite vanguard in competitive markets, then the 'Advanced Technologies' segment functions as its solid internal stronghold—exactly as Evonik put it in the announcement: 'The two businesses complement each other and will play a pivotal role in value creation for the Group.' Evonik’s second reform step targets management itself: streamlining management structures across the new business segments and significantly reducing costs over the long term. By the end of 2026, the Group’s organizational hierarchy will shrink from an average of ten levels to a maximum of six; approximately 1,000 managers will relinquish their managerial responsibilities and transition into expert roles. Starting April 2025, all operational management layers within Evonik’s businesses will be abolished to shorten decision-making processes. Meanwhile, parts of the former divisional management teams will retire, and operations of the new departments will be directly overseen by individual members of the Executive Board. Accompanying these sweeping reforms is a substantial workforce reduction. According to foreign media reports, Evonik’s business restructuring and streamlining plan may result in job losses for one-fifth of its employees—meaning this global chemical giant, which currently employs around 32,000 people worldwide, could ultimately cut approximately 7,000 positions. Evonik is one of the world’s leading specialty chemicals companies, composed of five divisions and their respective business lines: Nutrition & Care, Smart Materials, Performance Materials, Specialty Additives, and Technology & Infrastructure. Its production facilities span 27 countries, and its business reaches over 100 countries globally. In 2023, Evonik achieved sales of €15.3 billion and adjusted EBITDA of €1.66 billion. The Group currently employs approximately 32,000 people worldwide. It is worth noting that Evonik had already announced last September its plan for a comprehensive global organizational restructuring. At that time, Evonik issued a warning: 'The company no longer intends to operate three large sites domestically in Europe and will outsource those operations to new service providers. Simultaneously, the management team will develop an entirely new Group-wide management model—a plan affecting several thousand employees.' Since then, Evonik has accelerated its 'streamlining' efforts. On one hand, it successively divested its superabsorbent polymers business, parts of its coatings and adhesives resins business, and its C4 Verbund business. Evonik CEO Christian Kullmann publicly stated: 'We are divesting non-core businesses to concentrate resources on our strongest businesses.' On the other hand, layoffs have continued steadily. In March this year, Evonik announced plans to cut 2,000 jobs globally; by 2026, it will eliminate approximately 1,500 administrative positions in Germany alone—a move aimed at eliminating internal bureaucracy. Beyond the 2,000 job cuts, Evonik also plans to eliminate 1,000 management positions globally. Additionally, in August this year, Evonik disclosed it had earmarked €238 million for administrative layoffs. Evonik’s series of transformative initiatives is intrinsically linked to shifting external conditions. An undeniable fact is that the growth rate of Germany’s chemical industry is slowing down.

Germany will provide 'industrial electricity pricing' for energy-intensive industries next year—will this revive Germany’s chemical industry?

Germany is Europe’s top chemical power, accounting for 28% of Europe’s total chemical industry revenue. In the 2024 Global Top 50 Chemical Companies ranking, German firms—including BASF, Bayer, and Evonik—rank among the leaders. In 2024, German chemical enterprises invested a total of €4.2 billion in R&D; patents filed in chemistry and related fields accounted for one-sixth of the world’s total chemical patents. Germany leads globally in specialty chemicals, polymers, high-performance materials, and other fields, home to global chemical giants such as BASF, Covestro, Evonik, and Lanxess. Yet, in recent years, geopolitical tensions, persistently high energy prices, and U.S. tariff policies have jointly dealt a triple blow—even global chemical giants now struggle between plant closures and transformation. Wolfgang Große Entrup, Managing Director of the German Chemical Industry Association (VCI), assessed the current state of Germany’s chemical industry thus: 'The entire sector is currently navigating an exceptionally difficult year-end phase. From every perspective—production, sales, pricing, or capacity utilization—we observe negative growth across the board.' As Germany’s third-largest pillar industry—and indeed, as the representative of European chemical industry—the crisis is accelerating across the sector. Public data shows Germany’s chemical industry capacity utilization has fallen to a perilous 70%, far below the profitability threshold. 1. Crisis spreading: Even chemical giants are not spared According to forecasts by the German business weekly Wirtschaftswoche, Germany’s chemical industry situation will only worsen in 2025. The survival crisis confronting Germany’s chemical industry is multifaceted; in previous articles, we analyzed Europe’s chemical industry, with Germany’s chemical sector serving as its epitome. Evonik’s CEO Christian Kullmann believes Germany’s economy will weaken in the second half of 2025, while the U.S.’s constantly shifting tariff policies have thrown supply chains into chaos—recovery in the short term appears unlikely. Covestro considers the situation potentially graver: the transatlantic supply chain system is severely disrupted. Uncertainty surrounding U.S. tariff policies renders timely and effective implementation nearly impossible, seriously undermining stable raw material supplies. 2. Germany to introduce 'industrial electricity pricing' for energy-intensive industries Facing this prolonged and severe industrial crisis, the German government has recently rolled out multiple support policies. On November 3, following the EU ‘Friends of Industry’ conference, German Federal Minister for Economic Affairs and Climate Action, Katharina Reiche, announced: Starting January 1, 2026, energy-intensive industries in Germany will receive state-subsidized electricity pricing to alleviate part of their cost burden. Reiche emphasized specifically that 'industrial electricity pricing' is a key factor for competitiveness in Germany’s steel and chemical sectors.

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