FRANKFURT (Reuters) - German shipping company Hapag-Lloyd (HLAG.DE) confirmed on Wednesday that it is looking to cut up to 12 percent of its almost 11,000 land-based workforce after completing its merger with Arab peer UASC last week.
A spokesman at Hapag-Lloyd’s Hamburg headquarters said the job cuts would be made over the next 18 months to two years, confirming a report in Abu Dhabi-based The National newspaper and hints to this effect earlier this year.
The company did not say where jobs would be cut. Some 2,100 sea-based jobs would not be affected because vessels would continue to travel, the spokesman said.
The two businesses will start to integrate their services in about eight weeks in a process called commercial cut-over, which is due to be concluded by the end of the third quarter.
Staff levels would not be cut before then, he said.
Further steps entail the inclusion of UASC’s transport volumes on Hapag-Lloyd’s IT platform and the establishment of a new headquarters for the Middle East region.
The spokesman said that labor costs were less important to realising synergies from merging two shipping companies than network and procurement cost savings. Overheads will be cut by merging offices, he said.
Reporting by Vera Eckert, editing by Susan Fenton