Layoff round
The American company Levi Strauss is cutting 42 of the 250 jobs at its European headquarters in Machelen. The iconic jeans brand fears that persistent inflation will deter consumers from making new purchases.
Levi’s indicated at the end of January that it wanted to cut 10 to 15 percent of its administrative jobs worldwide, as part of a broader, two-year savings plan that should lead to cost savings of $100 million by 2024.
Wet-Renault
Belgium does not have a Levi’s production location, but it does house the European headquarters. According to a staff member, the first phase of the Renault law procedure was completed last week. The European management has stated that 42 jobs will be cut in Machelen. The staff of the thirteen Levi’s stores in our country are not affected.
The round of layoffs in Belgium did not come out of the blue. The iconic jeans brand from San Francisco recorded a stable turnover of $6.2 billion last year, but saw its income before interest and taxes (EBIT) fall by more than a fifth to $555 million. And at the beginning of this year, Levi’s really made a false start. The American company then reported a loss of $10.6 million in the first quarter.
Stubborn inflation
These red figures were mainly caused by the announced workforce reduction in February. That month, Levi’s announced that it would lay off 10 to 15 percent of its employees worldwide to address disappointing sales and the company’s high cost structure.
Levi’s, which has around 500 stores worldwide and has a true classic in its product range with the iconic 501 jeans, expects that persistent inflation worldwide will deter many consumers from making new purchases in 2024. The more than 150-year-old American jeans trouser maker expects that turnover for the entire year will only increase by 1 to 3 percent, which is a lot lower than previously expected.
Closure of Polish factory
When publishing its quarterly figures last Thursday, Levi’s immediately announced the closure of its Polish factory, the last production facility in Europe, causing 650 people to lose their jobs.
