- Preh reduced workforce and cut costs significantly amid declining demand
- Further restructuring likely as market uncertainty continues into 2026
Sharp workforce contraction at Preh GmbH reflects mounting pressure across the Germany-based automotive supplier landscape, where demand volatility and cost inflation are reshaping operational strategies. The company reported a significant drop in employee numbers at its Bad Neustadt site, declining from 1,585 at the end of 2024 to 1,224 by the close of 2025. This reduction forms part of a broader global effort that saw nearly 900 positions eliminated, enabling the company to reduce personnel costs by approximately EUR 37 million year-over-year.
Revenue Decline and Market Pressure Intensify
Financial performance in 2025 underscored the depth of the challenge, with revenue reaching around EUR 1.48 billion, marking a 4% decrease from EUR 1.53 billion in 2024 and falling short of internal targets by roughly 3%. The downturn is closely tied to weaker-than-expected production volumes from automotive manufacturers, which have not materialized as projected in earlier agreements. In fact, actual volumes were nearly 30% below original deal expectations, highlighting a widening gap between planning assumptions and market realities.
Below table summarizes the key data:
| Metric | Value |
|---|---|
| Employees (2024) | 1,585 |
| Employees (2025) | 1,224 |
| Revenue 2025 | EUR 1.48 Billion |
| Revenue 2024 | EUR 1.53 Billion |
Restructuring Plans Under Evaluation
Forward-looking strategy now centers on safeguarding long-term competitiveness as uncertainties persist across global markets. The company is actively reviewing additional restructuring measures, although no final decisions have been confirmed. Potential job cuts remain under consideration, indicating that cost optimization efforts are far from complete. These actions align with broader trends across the automotive industry, where suppliers are recalibrating operations to address declining order volumes and margin pressures.
External Risks and Industry Headwinds
Operational challenges extend beyond internal inefficiencies, with external risks compounding the situation. Geopolitical instability in the Middle East, rising raw material costs, and increasing supply chain disruptions continue to strain the sector. Companies across Europe are navigating similar constraints, forcing strategic shifts in production planning and workforce management. For Preh, these combined factors are expected to make 2026 a particularly challenging year, necessitating agile decision-making and potential structural transformation.
Frequently Asked Questions
Why did Preh GmbH reduce its workforce in 2025?
Preh GmbH reduced its workforce primarily to lower operational costs and adapt to declining demand from automotive manufacturers. The company faced lower-than-expected production volumes and rising cost pressures. As a result, it eliminated around 900 jobs globally, saving approximately EUR 37 million. This move aligns with broader industry trends where suppliers are restructuring to remain competitive amid uncertain market conditions and ongoing supply chain disruptions.
What challenges is Preh expected to face in 2026?
Preh is expected to face multiple challenges in 2026, including geopolitical instability, rising material costs, and persistent supply chain risks. Additionally, lower vehicle production volumes from OEMs continue to impact supplier revenues. These factors are likely to create a difficult operating environment, prompting the company to evaluate further restructuring measures. Continued uncertainty may lead to additional cost-cutting initiatives and strategic adjustments across its global operations.
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