Scania has decided to overhaul its production structure, which operates primarily out of Södertälje, Falun and Sibbhult. Around 1,800 people are currently employed in the production process.

“Continued streamlining of production is a precondition for keeping jobs in Sweden,” wrote managing director Leif Östling in a press release. He also talked of making “substantial cost savings”.

Scania’s head of information was vague about specific figures, however.

“It’s too early to comment on whether we’re talking about hundreds of millions or billions,” said Gunnar Boman.

It is also too early to say whether the cuts will mean fewer employees or a reduction in the number of production units, but Boman said that certain operations could be moved to different locations.

The assessment of what is required will be complete some time during the first quarter of 2006, and a reorganisation of production could be put into practice within 2-3 years.

The announcement is already causing concern among employees.

“Personally I’m a bit nervous, to say the least,” said Torbjörn Pedersén, the chairman of the Metall union chapter in Falun, where 650 people are employed by Scania.

He said it is hard to see how operations will be moved between towns, pointing out that skilled labourers will not simply move. He also noted that there has been a great deal of investment in the systems in Falun recently.

“And the investment is continuing, as far as I know,” he said.

Pedersén described the operations in Falun as “very profitable”, but acknowledged that there was no guarantee that any part of the company would escape the cuts.

TT/The Local