Recently, Autoliv, the global leader in automotive safety systems, announced its plans to reduce its workforce in France. In line with previous communications, Autoliv continues to adjust and downsize its total employee count, as well as streamline its logistics and operations. Autoliv stated that these measures are aimed at strengthening the company's long-term competitive position in response to a significant decrease in European light vehicle production levels post-pandemic.
According to Autoliv's plan, it intends to lay off approximately 20% of its workforce at its primary factories in France, which amounts to around 320 employees. This workforce reduction is expected to impact 220 indirect employees, and Autoliv also plans to relocate steering wheel manufacturing work from France to other facilities, affecting about 100 direct employees. The company hopes to initiate this workforce reduction plan in the first half of 2024 and expects to fully implement it by the end of 2025.
Autoliv noted that these measures in France are expected to save approximately $10 million by 2024, $20 million by 2025, and $25 million by 2026. The costs related to the layoffs will be accounted for in this quarter and will not affect the company's adjusted operating profit margin for the fourth quarter or the full year of 2023.
With this round of layoffs, Autoliv has announced direct layoffs of around 400 employees and indirect layoffs of more than 1,300 employees this year. It is anticipated that by 2024, these workforce reduction measures will save the company approximately $45 million in annual costs, $85 million by 2025, and a total of $110 million once fully implemented.
In June of this year, Autoliv announced its plans to cut up to 2,000 indirect positions worldwide, accounting for approximately 11% of its total indirect workforce. Of the positions to be cut, 1,000 were expected to be in Europe. Autoliv stated at the time that the first wave of layoffs was expected to occur in 2023.
