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16 January 2009 9:55 CET

Scania invests in employee training

At present, Scania is planning to invest in boosting the proficiency of its production employees instead of issuing lay-off notices due to low demand. In Sweden, employees will alternate between work and training days. Similar efforts are planned at the company’s other European production units and in South America. In Sweden, the scale of these training efforts will be determined, among other things, by the programmes for human resource development in the heavy vehicle industry that the Stockholm County Administrative Board intends to implement.

There is persistent uncertainty about short-term market trends. Scania will thus continue to focus on counteracting the build-up of inventories that has occurred due to weakening demand, in the wake of the global financial crisis and general uncertainty about developments further ahead.

“This is why during the immediate future, our production will be substantially smaller than was the case when the financial market turbulence arose. In this situation, however, we are planning to focus on boosting the proficiency of our employees instead of issuing lay-off notices. This is an investment in our core competency, whose outcome will be to make us even better equipped when the market rebounds,” says Per Hallberg, Executive Vice President and Head of Production and Procurement.

In planning its training programmes, Scania has pursued a dialogue with the Stockholm County Administrative Board, whose chief executive − County Governor Per Unckel − has been assigned by the Swedish government to study various possibilities for easing the impact of the financial crisis on the labour market. The County Administrative Board believes that widespread lay-offs would result in a great loss of skills and has thus applied to the European Social Fund for resources. Its application is related to the coordination and implementation of training efforts targeted to the heavy vehicle industry.

“For employees, human resource development not only means that they will improve their potential within the company. They will also strengthen their position in the labour market generally,” Mr Hallberg says.

In Sweden the ambition is to offer employees at the production units in Luleå, Södertälje and Oskarshamn general and individually adapted training in such fields as production engineering, Scania’s working method based on continuous improvements and the company’s common principles and values. Employees will also be offered the opportunity to supplement their knowledge of languages and mathematics. The scale of the programmes will depend on the outcome of the County Administrative Board’s application.

For similar efforts at the production units in the Netherlands and France, for example, Scania has the option of utilising existing public labour market and training grants.

“By training employees in improvement work and implementing it in practice in our workshops, we increase our ability to respond to competition when volume recovers. Employees who undergo continuous professional development feel a greater sense of participation and dedication and help boost our productivity and efficiency. For the future success of Scania, it is important that operational and human resource development go hand in hand,” Mr Hallberg says.

To adjust production to lower demand, since the end of October 2008 Scania has applied the existing flexibility agreements with trade union organisations − by not renewing the contracts of its 2,000 fixed term temporary employees in the global production network, as well as by taking advantage of the time bank system, which allows total weekly working hours to be increased or decreased. Scania’s extended production halt in conjunction with the Christmas and New Year holidays occurred within the framework of the flexibility agreements.

For further information, please contact:

Erik Ljungberg, Senior Vice President, Corporate Relations, tel +46 8 553 835 57.