Up to 600 people could lose their jobs as Konecranes aims to reduce its annual cost base by EUR30 million (USD39.8 million) before the end of 2014.

Approximately two-thirds of the cost-reduction measures will come from the equipment business area and one-third from the service area. Other actions to achieve savings in variable costs are also planned.

President and CEO Pekka Lundmark says the world is changing rapidly and the firm cannot expect the world economy to assist its growth. "We also expect the tough pricing environment to continue. Our overall cost is too high for our volume outlook, and we plan to adjust our cost base and the size of our organisation to market realities.

"In addition to fixed cost reduction, we are preparing several initiatives to rationalise our supply chain, to push down our variable costs. There is potential for savings in our non-personnel-related spending as well, but, unfortunately, effects (on) personnel cannot be avoided."

Konecranes says at the most, 600 staff will be affected through redundancies, temporary lay-offs and early retirements.

Konecranes employs approximately 12,000 people.

"We will improve our cost efficiency, but we also continue our three major initiatives for future competitiveness. First, we are introducing new technologies that enable real-time visibility to the condition and performance of the lifting devices and machine tools that we service.

"Second, we (will) develop a totally new product family mainly for emerging markets. Third, we (will) rebuild our fragmented IT systems to create real-time visibility to customer demand, field service, supply chain, and financials. All of these three strategic initiatives require new skills. Our competence development will, therefore, be of key importance in all of them," Lundmark explains.