Bayer Strong In 1994; Restructuring Continues

Global economic recovery and greater product demand helped Bayer of Germany turn in a strong performance in 1994 (Marketletter March 20). However, the company is still faced with a number of dilemmas.

Manfred Schneider, Bayer's chairman, pointed to an unsatisfactory pricing situation, which cost the group around 900 million Deutschemarks ($641.3 million), contrasting with 8% volume growth, the biggest Bayer has experienced in many years. Also, sales progress in Europe was subdued with growth of around 5%, which was below the group average. Domestic business was particularly slow, advancing 2%, mainly on recovery later in the year. Furthermore, Bayer is still battling with restructuring in order to maintain a competitive edge.

Dr Schneider was strong in his criticism of conditions in Germany for business. The high cost of labor and high environmental and other taxes make it difficult for businesses to operate in Germany.