Daimler Chief Human Resources Officer Wilfried Porth
“The combustion engine does not disappear overnight.”
StuttgartThe car maker Daimler wants to continue to recruit specialists in spite of the heavy pressure on the economy. “We have no general hiring freeze,” said chief executive officer Wilfried Porth the Handelsblatt: “If the know-how is needed, we stop.” The Mercedes manufacturer needed for the transformation of the auto industry, for example, cloud architects and data analysts. “In return, there are areas where we do not recruit new staff,” said Porth.
To reduce the personnel costs, the Daimler-Working director in Germany especially on the retirement of the baby boomer generation. “This is the most socially acceptable way,” explained Porth. Programs such as partial retirement and early retirement would be offered on an ongoing basis in consultation with the union and the works council.
In addition, Daimler is “at it all leverage to see how we can improve: strategy, portfolio, processes and services,” said Porth. From his point of view, Daimler can become even more efficient, especially in indirect areas, ie outside of production.
Read the complete interview here:
Mr. Porth, introduce the Kehrwoche at Daimler soon, according to the motto: “Each employee alternately sweeps the hall every few days” How do you feel about that? Because we have Swabian roots?
The background of my question is that you are currently reducing the cleaning intervals at headquarters. We constantly check our services and our own processes for their meaningfulness. And of course: When times are not quite as luscious, because we have to finance the present and the future at the same time, then you look usefully on the purchase of services. Nevertheless, there will certainly be no sweeping week with us.
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But you annoy the workforce by canceling business trips and cap in meetings. I have the example as an example to send a signal to your own organization that we urgently need to question some issues. Incidentally, we do not cancel business trips that are necessary and indispensable to a global business, even in the age of Skype and conference calls.
Analysts consider this little-Klein in saving for “ridiculous”. Would not you actually have to use far greater efficiency lever“Travel and consulting costs for a company with 300,000 employees can quickly add up to high millions of dollars. If we cut those costs by half, that’s not a small number. But of course there are many other areas where we can start.
Sounds nevertheless after “saving program light”. Other than in the years 2008 and 2009 we have no economic crisis. In the face of the greatest transformation in the history of the automotive industry, we need to invest in the future, secure jobs, solve many issues in the present, and remain profitable and attractive to our financial investors.
They aim at saving mainly on the administration, less on the production. Why? In production I have a cycle-dependent process with clear goals in order to reduce production times and increase efficiency. The point now is that we should also anchor this idea of efficiency in the administration. At the moment, however, we are working hard to see how we can improve: strategy, portfolio, processes and services.
How much time do you give yourself for this analysis? We have started and will take the necessary time.
According to “Manager Magazin” you want to save eight billion euros by 2021. The number is unknown to me.
Vita Wilfried Porth
The manager
Since 2009, Porth has been HR Director and Labor Director of 300,000 employees at Daimler. As soon as he took up his post on the top management board of the Mercedes manufacturer, the native of Baden-Baden had to make major cuts: Tens of thousands of employees had to give up because of losses on wages, the employee participation was canceled.
Porth studied mechanical engineering at the University of Stuttgart and started his career as a planning engineer at Daimler. After several executive stations abroad, Porth took over the management of the van division in 2006, which he is still responsible for today.
Since October 2015, Wilfried Porth has also been Deputy Chairman of the Supervisory Board of VfB-Stuttgart. In addition to football, the father of three sons loves to play tennis. He is regarded as a gripping and consistent negotiator. Porth is married and drives motorcycle enthusiastically.
The enterprise
In 2018, Daimler generated consolidated sales of 167.4 billion euros, more than half of which went to the Mercedes-Benz Cars division. Sales and sales were slightly higher for the Group for the eighth year in a row, but profits eroded. Earnings before interest and taxes (EBIT) fell by around 22 percent to a good 11 billion euros.
The first quarter was also unsatisfactory for the 300,000 employees. The operating result of the Stuttgart-based Dax Group collapsed with almost constant sales of 39.7 billion euros to 2.8 billion euros. That is a minus of 16 percent compared to last year.
The Swabians are struggling in all divisions operationally with enormous problems. In particular, the core Mercedes is weakening considerably. From January to March, the margin fell from nine to barely more than six percent year-on-year. The operating result for the heavy truck business fell by ten percent.
In the sections Vans and Busse writesDaimlereven losses. Whether in Europe, Asia or North America: all break up at Mercedes sales figures. The Stuttgart set from early January to late March only 561,000 cars. That is a decrease of 5.6 percent compared to the previous year.
Daimler has recently increased staff again. With a workforce of around 300,000 employees worldwide, you have now reached a maximum limit – neither a maximum nor a minimum limit of employees would make sense. How the total number of employees develops, for example, depends on factors such as the production figures and our growth plans. However, it is true that we can become even more efficient in indirect areas, ie outside production. But this is a constant exercise, as the pursuit of greater efficiency never ceases.
Do you have to create new programs for partial retirement, early retirement or severance pay, is there even a hiring freeze? We have no general hiring freeze. If the know-how is needed, we will stop. For example, we need cloud architects and data analysts to transform the auto industry. In return, there are areas where we do not recruit new staff. In Germany, we also use the fact that the baby boomer generation is retiring. This is the most socially acceptable way. Partial retirement and early retirement are also programs that always run in coordination with the union and the works council.
For Daimler employees in Germany, there is a job guarantee until 2020; with the reorganization into a holding company, jobs will even be guaranteed until the end of 2029. Are these generous promises taking their revenge now? No, because we need our people to shape the transformation. This is agreed by mutual agreement with the employee representatives.
The turnaround away from the burner to electric drives will also cost you jobs, right?It is true that the work content for an electric car in the sum of the total value added will be lower than the combustor. This is because an electric motor has fewer components. But I’m not one of those who panic about it and warn that soon thousands of employees have nothing left to do. I do not see that for us as Daimler.
Why? Because we continue to see growth opportunities for us. We believe that we do not yet make the best possible use of all countries and segments. The premium market will also continue to grow disproportionately.
Are you also so confident for the many small and medium-sized suppliers here in the Neckar Valley? I am optimistic about the world market leaders that are around us. The families behind these companies have always been able to adapt and compete with new competitors. And why should they have lost this ability overnight? That it takes a lot of effort, but is out of the question.
In order for change to be socially responsible, you and your suppliers will have to train and retrain thousands of employees. How do you turn a diesel engineer into a software expert and a car mechanic into a high-voltage specialist? First of all, we will need our engine engineers for quite some time. The internal combustion engine does not disappear overnight. Our luck is that engineers are curious people per se and want to improve the world with the products they develop. So we meet a clientele who by their own will have a great willingness to shape the future and to further develop their skills. In addition, together with the IHK, we are creating completely new job profiles, and a lot is happening at the universities as well.
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How much do you invest in training and retraining? Traditionally, we invest a lot of money in training. And this sum will rise sooner. That’s not on the savings plan.
Do you feel sufficiently supported by the politics in the transformation? In my view, the policy with the setting of the framework for the very first time the industry prescribed the technology. Lowering CO2 emissions from cars by 37.5 percent by 2030 is only possible with electromobility. We have no chance to launch the fuel cell or any other alternative at the same time.
One mistake? What I regret is that the topic of the environment is not seen holistically. At the moment there is a lot of pressure on the industry. But we have investment and technology cycles that can not be arbitrarily shortened. It takes time to develop new technologies and build the infrastructure. And not everyone who votes and votes for an ecopolitics buys the right car from the dealer.
After all, electric cars can not be politically prescribed – in the end, the customer decides which product he buys and how much money he is willing to spend. And we are seeing, for example, that many towns and cities still stock up on existing technology vehicles. For many years we have been accused of buses, because we do not have the necessary products. Now we have the products and notice that they are not ordered at all.
Electric buses cost usually twice as much as diesel buses. I just say: We all want to protect the earth from being tilted in terms of climate technology. But with the multitude of necessary steps we still have a hard time.
What do you expect from the political decision makers? I expect politicians to support this change, which they themselves want, in the appropriate places. How can I make it tasty for the customer to switch to electromobility? There are different possibilities, starting with the charging infrastructure.
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They probably also argue with international politics. Does the global tendency to more rather than less barriers to trade mean that corporations such as Daimler still have to produce more local goods? We have been seeing a certain shift towards foreign countries for some time now because volumes are rising there. In the end, the size of the market, in particular, determines the degree of localization. But one thing is clear: we can not produce every product anywhere in the world.
US President Donald Trump is said to have asked you to make more engines in the United States, as well as gearboxes. What we’ve learned in recent years is that the world is not so stable anymore. The framework conditions are changing faster than our investment cycles. That’s why we have to be as flexible as possible. At the same time, we can not override the economic rules of the automotive industry.
So you will not build transmissions in the US We will do everything possible to ensure that we continue to be successful in the US. There’s nothing more to say about that.
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