By Liz White, UT staffAmberg, Germany-Interiors and commercial vehicle seating supplier Grammer AG has reported sales in fiscal 2005 of Euro 858 million, a Euro 30-million rise over the previous year. But lower earnings have caused Grammer to start various cost-cutting measures, including an unspecified number of job cuts in Germany. The group reported sales growth in both divisions in 2005, with its automotive interiors business increasing sales by Euro 20 million to Euro 564 million. Its seating operation, which includes driver seats for trucks and offroad vehicles and passenger seats for trains, raised sales to Euro 300 million (2004: Euro 286.3 million). But the Amberg-headquartered group said, "As expected, earnings (EBIT) from operating activities has not reached the previous year's level." EBIT declined to Euro 32 million from Euro 40 million in 2004. Higher oil prices and a low general demand in the passenger seat business caused some of this drop, Grammer said. Added to this were expenses for "an unusually high number of product start-ups in the automotive division," as well as for setting up five new locations in Germany and China, Grammer said. These non-recurring expenses will not lead to income until the current fiscal year, the group added. Grammer feels its earnings will increase during 2006. Cost-cutting measures started in autumn 2005 to further lower costs should contribute to this increase, the company said. These include reduction of personnel at two German locations, among other things. Negotiations on personnel cutbacks between the board, the Works Council and IG Metall "were successfully concluded a few days ago," Grammer said. The agreements-subject to final committee approval-will save Grammer Euro 40 million per year until 2010, said Grammer's statement. The company added that it is implementing other measures to reduce personnel costs "at companies in Germany and abroad." Grammer says it is a leader in making component parts and systems for car interiors as well as for driver and passenger seats, which are the Company's core products. Its largest division, automotive, supplies headrests, armrests and centre consoles as well as integrated children's seats to major car manufacturers and their suppliers. As well as driver seats for trucks and offroad vehicles, Grammer is as an OEM and aftermarket supplier, providing passenger seats to OEMs and operators of trains and buses. The group has over 8000 employees in 20 consolidated companies, in 17 countries around the world. * Separately, Grammer said that its chairman, Heinz-Jürgen Otto, will leave the company on 31 March 2006, to continue his career outside the company.Grammer said Alois Ponnath will assume the duties of spokesman for the board in addition to his current duties as CFO. Peter Nagel remains responsible for the seating systems segment, and Uwe Wöhner, director of labour relations, remains responsible for the automotive segment. "