BASF Reaches Labor Agreement to Support Operations at German Site
BASF said it has signed a new site agreement with employee representatives covering operations at its Ludwigshafen complex, setting a framework for workforce stability, investment and structural changes through at least the end of 2028.
The agreement takes effect Jan. 1, 2026, and initially runs for three years. It includes an automatic two-year extension if agreed profitability targets are met. During the term of the agreement, the company said it will refrain from compulsory redundancies at the Ludwigshafen site.
According to the company, the agreement is designed to address competitive and geopolitical pressures facing the chemical industry while supporting operational adaptability at its largest integrated production site. It establishes conditions for organizational simplification, increased flexibility and the use of digitalization and artificial intelligence to improve productivity and support cost optimization.
The company said it plans to continue investing in infrastructure, capacity and site modernization at Ludwigshafen, with intended annual investment of about $2.2 billion, with a minimum of roughly $1.65 billion, to support long-term operations and sustainability-related upgrades.
The agreement also includes updates to expand digital tools for workforce deployment and increased emphasis on training and skills development to support evolving operational needs. According to the company, these measures are intended to maintain workforce readiness as processes and technologies change.
Health, safety and quality-of-life measures are also included, with continued investment in health programs, preventive care and site-related mobility infrastructure, the company said. Management and employee representatives also committed to regular reviews and transparent communication as changes are implemented.
“The new site agreement enables necessary changes and flexibility and supports the return to competitiveness at the Ludwigshafen site,” said Katja Scharpwinkel, a member of the board of executive directors and industrial relations director, in a statement.
Works council chairman Sinischa Horvat noted the agreement provides protection for employees while securing continued production, research and infrastructure investment at the site.
Recent operational announcements underscore Ludwigshafen’s ongoing role in BASF’s manufacturing strategy. According to the company, BASF plans to build a new electronic-grade ammonium hydroxide plant at the site to supply ultra-pure chemicals for semiconductor manufacturing, with operations expected to begin in 2027.
The investment comes as BASF continues to navigate weak demand across key end markets and cautious customer purchasing behavior, which the company said has weighed on recent results and is driving continued portfolio adjustments, divestitures and efficiency measures.