The online edition of the German newspaper Die Welt, reports that H&K management demands the company workforce to work 2.5 to 3 unpaid hours per week. This wage cut is apparently part of a company-wide cost cutting plan.
Quite surprisingly this happens in a period that has seen order intake growing, with substantial successes such as winning the AIF rifle contract and the recent supply to the Norwegian Armed Forces. However, the organization is dealing with high levels of debt piled up over several years. Moreover, despite the positive results, H&K are still reporting losses of about € 4 million ($ 4.5 million) over the first 9 months of 2018 against about € 164 million ($ 185 million) of revenue.
Possibly contributing to the losses there was also the settlement with ATK over the XM25 fiasco, about which TFB wrote a few months ago. On top of this, they have just been hit by a hefty fine for an international deal in 2010. The fine appears as an additional, unplanned, financial burden which may have tipped the scales towards the wage reduction.
Welt reports that the Company released the following statement when asked about the wage cuts (machine translated from German):
“We are currently working on a comprehensive innovation and growth pact involving all Heckler & Koch stakeholders. We do not want to give an intermediate stand during the ongoing negotiations.”
While the above is interpreted by Welt as a sign that a final decision has not been taken yet, to a less optimistic eye it may also appear as corporate jargon to cover worse resolutions on the way.
Whether H&K hates us or not, it is always saddening to see great firearm companies facing struggles. A potential victory of the contract to arm the Bundeswehr would possibly help the company in finally getting out of losses at the benefit of the affected workforce.
Full article in German available here.