Karstadt Plans 7,000 Layoffs

ESSEN, Germany (16 January) - Due to a restructuring program Karstadt-Quelle AG plans to cut 7,000 of its 52,000 workforce at its department stores. According to Reuters the German retail giant wants a so-called "soft cut", meaning that especially long serving employees will be soon forced into early retirement and will receive an attractive social (financial) security package as worked out by Karstadt-Quelle and the workers council. Since January 1st, 2000, the company's department store business has been run under the Karstadt Warenhaus AG name, a wholly owned subsidiary of Karstadt-Quelle AG. In Germany it oversees 204 department stores under the Karstadt, Hertie, KaDeWe, Wertheim and Alsterhaus names. The Essen-based Karstadt headquarters also oversees 24 sporting goods outlets under the Karstadt Sport name. Their bicycle product departments not only sell bicycles but also offer (as IBD's) a stationary service. Furthermore several department stores also have a sporting goods floor selling bicycles. In 1999 Karstadt Warenhaus AG achieved a total turnover of DEM 13.5 billion (US$6.5bn;EUR6.9bn).(JB)