Before the Russian armed forces launched a war of aggression against Ukraine on February 24, 2022, the Zeppelin Group’s books were well filled with orders from Eastern Europe, especially those from the construction machinery business in the Eurasian market. Since that day, every morning has started with a crisis meeting. “We are severely affected by the war,” reports Peter Gerstmann, CEO of the group, and estimates the expected loss of sales at 600 to 800 million euros for the entire Eurasian region. Peter Gerstmann expressly emphasizes: “We resolutely reject the violations of international law in Ukraine and condemn them in the strongest possible terms.”
Trade with countries such as Armenia, Uzbekistan, Tajikistan and Turkmenistan is also suffering from the unfortunate overall situation. As a sales and service partner of Caterpillar Inc., the world’s largest manufacturer of construction machinery, Zeppelin was active “from the Arctic Circle to the Black Sea,” says Gerstmann. This business area is now idle and he doesn’t believe that it will recover once the crisis has been overcome. “We will have to realign ourselves,” says the managing director.
The company helps Ukrainian employees to evacuate
According to him, no employees of the group at the Garching site are affected by the consequences of the war, all the more the people who work for Zeppelin in the war zones. From one day to the next, 600 left their jobs in Ukraine. He is in constant contact with the managers in Russia and Ukraine via e-mail and telephone, says Gerstmann. Employees in Russia and Ukraine were told to stay at home and look after their families on the day the war broke out. In view of the ongoing talks about Western sanctions against Russia, also in the financial sector, Zeppelin had ordered them to pay their last salary before the end of the month.
In order to alleviate the difficult situation of the Ukrainian employees in particular, the group offered to help them evacuate. The offer was initially accepted very hesitantly because most of the employees did not want to leave the country they had been attacked. However, the evacuation is now progressing, with the help of employees at a Polish Zeppelin branch. And for people who have already fled the country, the company has launched an appeal to the workforce in Poland, Germany and Austria to offer living space for these people under the motto “Accommodation from Zeppelin for Zeppelin”. The response to the appeal in-house was very positive, a company spokeswoman reported on Tuesday.
When the crisis is over, “then it will be another company,” says the CEO
Compared to the current challenges that the company has had to face since the Russians invaded Ukraine, the Corona crisis was easy to manage, says Gerstmann. Due to drastic savings measures, the Zeppelin Group came through the pandemic year 2020 well overall and was able to keep profits stable. Through acquisitions, the company’s turnover even increased, from 3.1 billion to 3.3 billion euros. The largest company in the group, Zeppelin Baumaschinen GmbH, made a significant contribution to this with sales of 1.09 billion euros in 2020. In addition to the sale of new and used Caterpillar construction machinery, the product portfolio includes service, which is provided nationwide in 35 branches, as well as advice and financing for the equipment. In the 2021 financial year, sales and profits could be increased. However, the current crisis is affecting Zeppelin more than other German companies. And when the crisis is over, “then it will be another company,” believes the chairman of the Zeppelin management board.