German chemical MNC BASF has committed to investing between €1.5 billion and €2 billion annually in its Ludwigshafen site as part of a new five-year site agreement signed with employee representatives on December 15, 2025. The investments are intended to enable modernization, expansion, and the site's sustainable transformation.
The new "Shaping the Future for a Strong Site" agreement initially applies from January 1, 2026, to December 31, 2028, with an automatic extension of two years if profitability targets are met.
The funds will be directed toward infrastructure, capacity modernization and expansion, and the sustainable transformation of the site to become Europe's leading sustainable chemical site.
As part of the agreement, BASF has committed to refraining from compulsory redundancies for operational reasons for the duration of the agreement, providing job security for approximately 33,000 employees.
The agreement also outlines sweeping changes to how work is organized. BASF will simplify structures, increase flexibility and accelerate the use of digitalization and artificial intelligence to boost productivity, while maintaining a strict focus on sustainable cost optimization. Working time management will be modernized, supported by digital tools to improve workforce deployment.
Katja Scharpwinkel, Member of the Board of Executive Directors and Industrial Relations Director, BASF SE, said: "The new site agreement is the result of constructive negotiations between management and employee representatives. It enables necessary changes and flexibility and supports the return to competitiveness at the Ludwigshafen site.
"At the same time, it provides guidance and reliability in an environment characterized by change. A period of at least three years without compulsory redundancies creates reliability for implementing our transformation projects. We will also continue to invest in Ludwigshafen – this shows that the site has a future, and our employees make a decisive contribution with their expertise and experience.”
Works council chairman Sinischa Horvat described the outcome as a decisive win for both the site and its workforce.
“The tough negotiations were worth it: The central importance of the Ludwigshafen site with production, research and development, marketing, specialist departments, infrastructure and services is ensured by concrete investments, and employees are protected from compulsory redundancies during the term of the agreement. Given the persistent structural and economic challenges, this outcome was is by no means a foregone conclusion.
"But in the end, it is a clear commitment to the site, to the employees – who are the key to success – and an expression of confidence that together we can get BASF SE back on track for success. When we start 2026, our minds will again be able to focus on the major structural challenges we need to tackle.”
With billions in investment pledged and job security guaranteed, BASF is betting that partnership-based cooperation and bold transformation will keep Ludwigshafen at the heart of its global strategy.
