German truck and bus manufacturer MAN said Friday it will cut up to one in four of its employees as it looks to make an "extensive restructuring," with the coronavirus pandemic battering the industry.
The Munich-based company said it would lay off as many as 9,500 jobs in Germany and Austria as it looks to save 1.8 billion euros (US$2.1 billion) annually.
Two sites in Germany and one site in Austria may be closed.
MAN reported an operating loss of 423 million euros ($500 million) in the first half of the year, and a revenue decline of 26%, as the spread of COVID-19 impacted customer demand and supply chains.
However, the company was already struggling, and had planned a cost-cutting program to react to a drop in demand that worsened with the health crisis. According to media reports, the group had envisaged axing up to 6,000 jobs.
"The commercial vehicle industry is undergoing radical change," MAN said.
"Already in a few years' time, it will be virtually impossible to build a successful business model on the technologies and structures of today."
MAN said the move was part of a pivot towards sustainability.
Chief executive Andreas Tostmann said the company was facing "major challenges" due to technological change, particularly with "digitalization, automation, and alternative drives".
"This is why we need to restructure MAN: to become a lot more innovative, digital, and profitable in the long run," he said.
MAN is 95% owned by Traton, the heavy-goods vehicle branch of German auto giant Volkswagen.
Another Traton company, Sweden-based Scania, said in June it would cut 5,000 jobs -- around 10% of its workforce.
Volkswagen reported a pretax loss of 1.4 billion euros for the first half of 2020 after the coronavirus pandemic sent sales plummeting.