Restructuring under way as car seat company files for administration
Price increases and the loss of key contracts have led car seat producer Recaro Automotive to go into administration.
The Baden-Württemberg-based company announced on July 30 that it had filed the necessary documents at a court in the city of Esslingen.
Recaro Automotive said it had encountered “significant financial difficulties” in recent years owing to cost-rises and the loss of important contracts. It said these cost-pressures had held it back from developing new product offerings and that this had been a factor too.
It held a meeting with workers, trade union representatives and representatives of the local authorities on July 30 to say that the court had approved “preliminary self-administration”.
This is a restructuring process, which the current leadership of a business usually undertakes under the supervision of an independent, court-appointed authority. In this case, legal firm Schultze & Braun will fulfil that judicial supervisory role and has appointed one of its lawyers, Holger Blümle, to carry out this work.
International consulting firm Baker Tilly is also working with Recaro Automotive on its restructuring.
The company said it intended to maintain full production during the administration proceedings and continue to fulfil all existing orders and new customer enquiries. It said employees’ salary payments were secure.
It said it expects its restructuring efforts to be successful, for the exercise to strengthen its position, locally and globally, and for the business “to stand on solid ground again soon”.
