Babelsberg's art unit on precipice
EmptyCOLOGNE, Germany -- Despite major job cuts and restructuring, Studio Babelsberg's art division could still go under.
Carl Woebcken, CEO of Studio Babelsberg AG, on Thursday confirmed media reports that Babelsberg subsidiary Art Department Studio Babelsberg was in danger of being shut down due to pressures from the international marketplace.
"The general tendency in set building is to increasingly use subcontractors, which greatly strains the finances of our loss-making subsidiary," Woebcken said.
Bertelsmann recently announced it was cutting 40 jobs at the Art Department, about half of the division's total workforce. The cuts will go into effect next year.
But Woebcken insisted the overall picture looks good for Germany's oldest film studio. In particular, he said that a new German law providing tax breaks for film production will boost business.
That failed to convince investors. Babelsberg stock fell to a new all-time low of €1.15 ($1.52) in early trading Thursday. It recovered much of the loss later in the day but by late afternoon was still down 1.5% at €1.35 ($1.79).