NEMAK Lays Off Almost 20% of Workforce in Győr

The cylinder heads manufacturer Nemak Győr Alumíniumöntöde (aluminum foundry) Ltd., which employs about a thousand people, will have 180 of its employees laid off by the end of July, the Hungarian news agency MTI reports.

In his statement to the news agency, the company's financial director, Gábor Mersich writes that the redundancy at the Mexican-owned company is justified by the fact that the number of orders in the automotive industry has significantly decreased due to the economic downturn caused by the coronavirus epidemic, and this situation promises to be permanent. He added that the downsizing will affect all areas at the company, but at a lower rate than would be justified by a 30-40% drop in order backlog.

The CFO points out that, taking all possibilities into account, the decision to reduce the staff and to provide a "caring redundancy program" for the staff concerned had been taken in close cooperation with the works council and the human resources department.

The announcement also mentions the introduction of 36-hour work week at Nemak from May and that the company will be forced to introduce a 32-hour work week from June due to a further drop in orders. It adds that due to its operational specifics, the company is not able to apply any of the economic protection programs introduced by the government in its current form.

Since the start of the epidemic, the company’s management has introduced several measures to protect jobs. Employees were able to take days off given their their accumulated work hours, and many white-collar employees were able to work from home. Workers for whom the company was unable to provide work were provided with a wage subsidy from mid-March.