"Building a Bright Future for a Resilient Site": BASF SE Signs New Site Agreement for Ludwigshafen
In a significant step toward ensuring the sustainability and productivity of its operations, BASF SE’s management and employee representatives have finalized a new site agreement entitled "Building a Bright Future for a Resilient Site." This agreement is set to be in effect for five years, starting with an initial three-year term from January 1, 2026, until December 31, 2028, specifically tailored for the employees at the Ludwigshafen facility. If the agreed-upon goals for regaining profitability are met, the agreement will automatically extend for an additional two years.
This new agreement tackles the pressing challenges that the chemical sector currently faces. Given the economic uncertainties and geopolitical factors impacting the industry, it emphasizes the importance of maintaining competitiveness and adaptability at the Ludwigshafen site. The agreement lays the groundwork for necessary structural transformations, safeguards employees from involuntary layoffs, and sends a robust message regarding future investments and cooperative partnerships. As BASF’s largest Verbund site, Ludwigshafen plays a crucial role in the company’s long-term success.
Key Highlights of the Agreement:
- Job Security: BASF commits to not implementing any compulsory redundancies throughout the duration of this agreement, providing employees with much-needed job security.
- Investment Commitment: The company pledges to invest heavily in the Ludwigshafen site, aiming to position it as Europe’s leading sustainable chemical hub. BASF plans to allocate around 2 billion euros annually, with a minimum of 1.5 billion euros earmarked for modernizing and expanding infrastructure, enhancing capacity, and facilitating the site's sustainable transformation.
- Adaptation and Flexibility: This sustainable transformation aims to preserve the site’s competitiveness, which will entail organizational simplifications and increased flexibility. The integration of digital technologies and artificial intelligence will be pivotal in driving ongoing productivity improvements while consistently focusing on cost optimization.
- Modernized Work Time Management: Enhancements in work time management practices will be made, supported by digital tools to optimize personnel deployment effectively.
- Encouraging Performance and Growth: The agreement fosters a culture of performance, emphasizing the need for skill development and continuous learning among employees. By adopting modern training approaches and targeted skill enhancement programs, BASF aims to ensure that its workforce remains employable and innovative.
- Health and Wellbeing Initiatives: BASF is committed to investing in health initiatives that promote both physical and mental wellbeing. This includes launching preventive healthcare programs, expanding electric vehicle charging infrastructure, and encouraging public transport usage. Furthermore, BASF is dedicated to fostering education, equal opportunity, and social cohesion within the Rhine-Neckar metropolitan area.
- Clear Framework and Open Communication: The agreement outlines clear guidelines for executing the transformation and establishes a framework for regular assessments of its progress. Both management and the works council pledge to engage in constructive dialogue focused on solutions.
According to Katja Scharpwinkel, a member of the Board of Executive Directors and Industrial Relations Director at BASF SE, "This new site agreement is the product of constructive negotiations between management and employee representatives. It facilitates essential changes and flexibility while supporting our efforts to regain competitiveness at the Ludwigshafen site. Additionally, it establishes a sense of guidance and reliability in an ever-evolving environment. A guaranteed period of at least three years without compulsory redundancies instills confidence as we undertake our transformation projects. We are also determined to maintain our investment in Ludwigshafen, reinforcing our belief in the future of this site and underscoring the critical contribution of our employees’ expertise and experience."
Sinischa Horvat, Chairman of the Works Council at BASF SE, remarked, "The rigorous negotiations were ultimately fruitful: the vital role of the Ludwigshafen site, encompassing production, research and development, marketing, specialized departments, infrastructure, and services, is secured through concrete investments, while employee protection against compulsory redundancies during the contract’s validity is ensured. Given the enduring structural and economic hurdles we face, reaching this outcome was by no means guaranteed. However, it clearly reflects a commitment to the site and its workforce—the true key to success—and expresses confidence that together, we can steer BASF SE back towards a successful trajectory. As we approach 2026, we will refocus our efforts on addressing the significant structural challenges ahead."
