Finnish battery chemical maker Terrafame announced on Tuesday it is considering laying off its employees following the slowdown of electric mobility in Europe.
According to a statement, the company is negotiating job cuts and reduced working hours to adapt to the declining sales of electric vehicles spurred by a lack of charging infrastructure and concerns about resale values.
Prices of battery chemicals have dropped alongside those of metals such as nickel and cobalt, which are used to make these chemicals.
Terrafame said that it expects the battery chemicals market to continue to be challenging next year and will need to cut its payroll.
“The battery chemicals market, in particular, has continued to be challenging,” said Terrafame CEO Seppo Voutilainen in the statement, while adding that the downturn affected the company’s net sales and profitability.
He added that the aim of the change negotiations is to find a solution for adjusting personnel resources, working time patterns and general work arrangements to meet the changed needs and outlook of the company’s business.
The company’s net sales for the July-to-September quarter fell 26.6 percent to €104.8 million ($112.92 million) compared to €142 million in the corresponding period last year due to decreased production and delivery volumes.
Prices of battery chemicals have dropped alongside those of metals such as nickel and cobalt used to make these chemicals.
Early this year, Terrafame initiated a profitability program aiming for annual savings of €10 million, yet it couldn’t achieve the target.
“In spite of the positive development of our cost efficiency, we are now forced to initiate change negotiations due to the continued challenging operating environment,” added Voutilainen.
The outcome of the negotiations will be crucial not only for Terrafame’s financial health but also for its ability to contribute to the evolving market for sustainable energy solutions.
