Huge cuts at Gothenburg ball bearing plant

The world's biggest producer of ball bearings SKF announced massive job cuts on Wednesday even though its net profits soared fivefold in 2014.

With its products widely used in manufacturing, the fortunes of SKF – which plans to shed 1,500 jobs – are considered a valuable indicator of global industrial activity.

The company's net profits landed at 4.8 billion kronor (518 million euros, $588 million) in 2014 — up from 1 billion kronor the year before.

"With our simplified structure, I am convinced that we will be even better and quicker at creating competitive products and services with customer applications in focus," chief executive Alrik Danielsson said in a statement.

SKF – which employs 48,600 people – believes the cost-cutting measureswill yield a "7.5 percent productivity improvement over the coming two years."

The layoffs were announced as the Gothenburg-based company said its industrial side had "gained some momentum" while its "automotive business slowed somewhat."

Sweden is a member of the European Union, but not of the eurozone, where industrial output has been on the rise for three straight months.

"Asia once again had the strongest growth and North and Latin America developed well, while Europe remained relatively unchanged," Danielsson said.

SKF's annual sales brought in 70 billion kronor in 2014, up 12 percent from the previous year.