Metsä Group to Initiate Statutory Negotiations to Improve its Profitability and Operational Efficiency

On 31 July 2025, Metsä Group announced it would launch the planning of a EUR 300 million cost savings and profit improvement program. Planning is now complete, and Metsä Group will initiate statutory negotiations concerning its personnel as part of it.

“Our profitability has been undermined by three factors. First, increased uncertainties in global trade have reduced demand for our products. Second, changes in exchange rates have weakened our result and will continue to do so. Third, the increase in raw material costs and the general cost level has eroded our profitability,” says Jussi Vanhanen, President and CEO of Metsä Group. “We operate in a capital-intensive business in which lower utilisation rates due to weak demand combined with clearly higher costs create an unsustainable equation that must be addressed,” says Vanhanen.

When planning the cost savings program, attention was paid to procurement and logistics costs, and the wood supply chain’s efficiency. These account for a considerable share of the planned savings. In addition, the need to restructure and streamline operations to reduce fixed costs was recognised. Significant efficiency enhancement measures were also identified in variable costs.

“Our employees have done good work within our current operating model. Unfortunately, it isn’t enough in this situation. We must tackle the things that are in our own hands and shape our operations to ensure long-term competitiveness,” says Vanhanen.

According to preliminary assessments, the planned measures may lead to a permanent reduction of 800 permanent jobs. A significant share – 540 jobs – are expected to be in Finland. In addition to redundancies, the planned changes may lead to changes in duties. Statutory negotiations with personnel representatives will be initiated in accordance with each country’s legislation. Metsä Group employs approximately 9,600 people globally, of whom 5,600 are in Finland. The planned reductions at Metsä Board, a listed company part of Metsä Group, are included in these figures. 

The negotiations will not include permanent closures of production units. The development of Metsä Group’s new business projects (Muoto, Kuura, lignin and bio-based CO2 capture) will continue according to each project’s individual plan and schedule. Cost provisions related to the cost savings and profit improvement program will be recorded in the result for the last quarter of the year.

 

Source: Metsä Group