A major global supplier of regenerated cellulosic fibers, Lenzing AG has unveiled a refined strategy to solidify its competitive edge amidst ongoing challenges in the textile and nonwovens markets and shifting geopolitical landscapes. The company aims to strengthen its agility, resilience, and cost structure, focusing on long-term value creation to maintain its position as a global leader in sustainable cellulosic fibers.
The strategy centers on three main pillars: prioritizing high-performance fibers, enhancing operational efficiency, and optimizing its asset footprint. Rohit Aggarwal, CEO, states, 2025 is a year of ‘continued execution,’ building on the company's ability to increase profitability even in a volatile environment.
Lenzing is strategically pivoting toward higher-margin, premium branded fibers like Tencel, Veocel, and Lenzing Ecovero, while gradually moving away from lower-margin commodity segments. This premiumization strategy includes a strategic review, potentially leading to the sale of its Indonesian production site.
Growth will target not only established areas like denim and home textiles but also expansion into high-value applications such as hygiene, packaging, filtration, medical, and industrial uses. To capture growing demand for renewable nonwoven fibers, the company will selectively shift production capacity from textile to nonwoven applications. Furthermore, Lenzing will intensify application-driven innovation through strategic customer partnerships and strengthening its application innovation centers.
To combat a weak market recovery, low generic fiber prices, and rising input costs, Lenzing is implementing aggressive efficiency measures. These measures include a significant reduction in its Lenzing-based headquarters headcount by approximately 300 employees by the end of 2025, primarily in overhead functions, aiming for over €25 million in annual savings from 2026.
Strengthening its presence in Asia and North America, will help reduce headcount by 300 by 2027 -end. Combined, these two measures are expected to deliver annual savings of more than €45 million.
