VIENNA - Austrian steelmaker Voestalpine said on Wednesday it will cut working hours for thousands more of its staff as the global downturn cripples demand for steel.

The company, a supplier of steel to Europe's troubled car market, said an additional 2,700 employees at its Linz plant would be affected by the shorter working week from May onwards, bringing the total to 5,900.

The shorter work week is being extended to more employees and lengthened ... there is already an agreement between the company management and the workers' council, it just needs to be made official, said a spokesman.

Voestalpine, which in February gave a grim outlook for the steel industry and forecast a drop in full-year operating profit, employs 42,000 people worldwide, of which 10,000 are now on a shorter working week.

ArcelorMittal (ISPA.AS), the world's biggest steel group, has said it expects overall steel demand to fall 7 to 10 percent in 2009.

Voestalpine's Linz plant produces steel products for the automobile, household appliances and construction sectors, all of which have been hard hit by the economic downturn.

Shares in Voestalpine were down 1.7 percent at 13.57 euros by 1404 GMT, outperforming the DJ Stoxx Basic Resources .SXPP index which was down 7 percent. (Reporting by Alexandra Schwarz; Writing by Sarah Marsh; Editing by David Holmes)