BASF, the world's leading chemical group, lowered its 2008 earnings targets on Oct. 20 and voiced concern about a possible recession next year, while announcing it would cut 1,000 jobs by 2012.
"The impact of the global financial crisis on the real economy is speeding up and hitting harder," chairman Juergen Hambrecht said. "The economic skid marks can no longer be ignored. The decline in demand in important markets, stockpiling by our customers and the fall in oil prices are all signs of a recessionary trend that is likely to sharpen in 2009."
As a result, it was impossible for BASF to give a "solid forecast," he said. A company statement said that "BASF will make every effort to match the previous year's excellent earnings."
BASF thus planned to lower production in response to weakening demand, and cut 1,000 posts by 2012 as part of a plan to cut costs.
In the third quarter of 2008, the group's net profit fell by more than 37% to 758 million euros (US$1.0 billion). Core earnings decreased by a more modest 8% to 1.57 billion euros on sales that gained 13% to 15.77 billion.
Copyright Agence France-Presse, 2008