Page last updated at 16:11 GMT, Friday, 30 January 2009

Porsche scales back worker hours

Porsche
Car sales are falling as consumers cut back on expensive purchases

Porsche has become the latest car manufacturer to cut back worker hours amid falling global demand.

Porsche's preliminary results for the six months to the end of January revealed sales had slumped 14% to 3bn euros ($3.9bn; 2.7bn).

The number of cars sold fell 27% to 34,000 in the six-month period. No profit figures were released.

Porsche said it would reduce hours as a result, but the company remained upbeat about its prospects.

Falling demand

In total, the German luxury car maker will cut production by about 19 days between now and April.

Porsche had already cut eight days production in January at its main site in Zuffenhausen.

These cuts follow a drop in sales. In the US, Porsche's biggest market, the company sold 11,850 cars in the six months to the end of January, a 27% drop from the same period a year earlier.

In Germany, total sales declined 26% to 4,150 vehicles in that period.

Upbeat

Despite Friday's announcement, Porsche chief Wendelin Wiedeking said job cuts and a long-running shorter hours scheme were "not on the current agenda".

He was also buoyant about Porsche's ability to withstand further turmoil in the car industry, saying Porsche "always produced one car less than the market needs".

The Stuttgart-based company will release its official figures in March, following the publication of Volkswagen's earnings. Porsche has a majority 50.8% stake Volkswagen.

Porsche made a profit of 6.4bn euros in 2007/08, up from the 4.2bn it made in the previous year.

Consumer cutback

Several car companies have pared back working hours as consumer demand for big-ticket items continues to decline.

Japanese car manufacturer Honda is set to close its a Swindon-based factory for four months on Friday in a move that will affect just over 2,500 of its 3,700 employees.

They will receive their full basic pay for the first two months, but around 60% thereafter.

Thus far BMW, Bentley, Vauxhall, Honda, Jaguar, Land Rover, Nissan, Rolls Royce and Toyota have all had shutdown periods.

Honda's net profit for the three months December plunged 89%.

Meanwhile, carmaker Gaz is said to be in a "difficult situation" according to the Russian government.

Toyota has predicted a 150bn yen operating loss for the year to March, a figure which analysts expect to increase.



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