In his first visit to Lanxess’ North American operations since becoming chief executive of the German-based specialty chemicals and rubbers maker in April, Matthias Zachert said Thursday that Pittsburgh “will remain a central hub … and stronghold” even as the company prepares to cut jobs and streamline operations.
Mr. Zachert did not rule out employee reductions in the Pittsburgh region, where Lanxess maintains its North American headquarters in Findlay, but said most administrative job cutbacks are likely to happen in Germany.
About 350 people work for Lanxess in the region, including at the headquarters operation and at facilities on Neville Island and in Burgettstown, Washington County. There are about 1,500 Lanxess employees throughout North America and 17,500 worldwide.
The North American operations typically account for 15 to 20 percent of Lanxess’ global sales, which in 2013 totaled $11.4 billion.
Last week, the company disclosed some of its restructuring plans, saying it will reduce the number of business units from 14 to 10, and create a division to focus on specialty rubbers and tires.
In November, it will provide the “hard facts” on how many jobs may be eliminated and where the cuts will be, Mr. Zachert said during an interview at Lanxess’ offices in the RIDC office park off the Parkway West.
The company’s restructuring comes as it continues to face a tough market for synthetic rubbers used in tires and other automotive parts.
Though Mr. Zachert remains optimistic about the company’s “strong global presence” in that market, “The bottom line is that [Lanxess] invested too much and the cost structure is too high” to continue without realigning the business, he said.
He touted Lanxess’ announcement earlier this week that it will invest $15 million in its Gastonia, N.C., plant that makes plastics used in automotive components such as steering rods, pedals and oil pans. Lanxess is betting that plastic car parts will replace many metal components.
“Gastonia somewhat sets the scene of the importance” of North America to Lanxess, Mr. Zachert said.
For three years prior to his current job, Mr. Zachert, 46, was chief financial officer of Merck, the German-based pharmaceuticals and chemicals giant.
Before that, he was Lanxess’ chief financial officer from 2004 to 2011.
“I’ve always been a CFO who was always putting his hands into the machine,” he said. “I like the operations.”
Joyce Gannon: email@example.com or 412-263-1580.