The global automotive industry recession claimed its best known German victim when independent contract carmaker and cabrio roof-top specialist Karmann filed for insolvency.
The family-owned company, perhaps best known for the legendary Volkswagen Karmen Ghia sports car, said falling sales meant it could not afford to pay for a huge redundancy programme.
“The sheer unexpected drop in revenue led to the inability to finance the social plan that was agreed with labour representatives,” said the company, which had revenues of 1.3?billion euros (£1.2?billion) last year.
Karmann presented a restructuring plan in September 2008, but deteriorating finances made the Osnabrueck-based firm unable to pay for a wave of 2,240 layoffs, half of Karmann’s 4,460 German workers.
Although most famous for the 1950s VW Beetle-based coupe, the company also developed the retractable hardtop roof first introduced with the Mercedes-Benz SLK before the idea was later copied by competitors, finding widespread use in popular volume models like the Peugeot 207cc.
In recent years, a trend among carmakers such as Volkswagen and Daimler to reduce outsourcing the assembly of cars to third-party firms made it more difficult for Karmann to win new contracts. The trend has already crippled rivals such as French firm Heuliez, and Italian car stylists Carozzeria Bertone, and Pininfarina.
The last Audi A4 cabrio left the assembly line at the end of February and Karmann’s only remaining production contract – to build the Mercedes-Benz CLK cabrio for Daimler – is set to end in mid-May.
“Together with the court-appointed insolvency administrator, the goal will be to lead the newly-structured Karmann corporate group into a secure future and save as many jobs as possible.’’ Karmann said in a statement.
A spokesman explained that operations would continue just as before since the company had virtually no bank debt, rather Karmann was forced to file for insolvency under German law since it could not pay for the massive layoff plan.
