BERLIN (AP) -- German car parts maker Schaeffler Group KG on Tuesday agreed not to lay off workers for the next year under a plan that aims to save costs by cutting work hours, among other measures.
Schaeffler said earlier this month that it needed to save euro250 million ($350 million) in annual costs after the global economic crisis cut deeply into auto sales. It said that could translate into as many as 4,500 job cuts in Germany, but pledged to avoid layoffs.
Under the deal reached Tuesday with the IG Metall industrial union, Schaeffler ruled out layoffs until June 30, 2010, so long as that cost-cutting target can be achieved.
Schaeffler said cost-cutting measures would be determined site by site, with possibilities including shorter working hours and corresponding wage cuts, cutbacks in one-time payments and partial retirement.
"With this agreement, we gain time," IG Metall chairman Berthold Huber said in a statement. "It is the right answer to the massive decline of the economy."
Herzogenaurach-based Schaeffler has been hit both by the car industry's plight and by problems related to its takeover, completed in January, of tire maker Continental AG.
The move indebted Schaeffler heavily just as the economic crisis took hold.
Schaeffler has some 66,000 workers worldwide, 28,000 of them in Germany.