Barloworld to implement group-wide retrenchments as coronavirus ‘severely affects’ business
Logistics and fleet management company Barloworld [JSE:BAW] says it will implement group-wide retrenchments as it battles the economic shock of Covid-19 on its business.
In a trading update on Thursday, the group said that while austerity measures implemented earlier in the year were yielding cost savings, the business had been “severely” impacted by trade restrictions and lockdowns instituted to slow the spread of the pandemic.
“In an effort to adjust to the requirements of trading in a significantly changed environment while positioning the business for a recovery, management and the board have decided to institute group-wide retrenchments, in addition to the 12-month remuneration sacrifice plan implemented on 1 May 2020,” the notice read.
“Retrenchment processes are expected to be completed by the end of the current financial year with significant staff complement reductions at Automotive and Logistics, Equipment southern Africa and the Corporate Centre,” it said. Barloworld’s financial year end is 30 September 2020.
It did not say how many jobs were at risk of being lost.
Barloworld, established in 1902, is a conglomerate that spans logistics management services, fleet management and the distribution of equipment.
The group’s automotive and logistics division was significantly impacted in April when only essential services were allowed to operate.
Its Avis Budget Rent-a-Car business, which relies partly on travel through airports, saw passenger numbers plunge as fleet utilisation declined from over 75{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} before the pandemic to below 30{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2}. These figures are slowly improving, the group said on Thursday, in line with the gradual easing of lockdown restrictions
About 55{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} the transport fleet in Barloworld’s Logistics division managed to operate during lockdown – mainly to support essential services.