Whirlpool to cut 5,000 jobs

BENTON HARBOR, Mich. Whirlpool announced that in order to reduce costs, it has cut approximately 5,000 jobs across its global organization, including both jobs that have already been announced through plant closures along with new reductions taking place now and through the end of 2009.

In North America specifically, Whirlpool said the cuts would affect about 500 positions.

According to Jeff Fettig, Whirlpool chairman and ceo, the actions are expected to produce savings of approximately $275 million on an annualized basis. "While decisions to eliminate jobs and close facilities are very difficult, they are necessary to create a cost-effective business structure. These changes will ensure that our company is proactively taking the necessary steps to adjust its cost structure and production capacity to lower expected demand levels."

Whirlpool's staff reductions come after the company announced that earning from continuing operations decreased 7% to $163 million, or $2.15 per diluted share, compared to $175 million, or $2.20 per diluted share reported during the previous year's quarter. Revenue of $4.9 billion for the quarter increased 1% from the $4.8 billion reported in the third quarter of 2007.

"We are in the midst of a rapidly changing and very challenging economic environment. We have seen a sharp drop in demand in North America and Europe during the third quarter, and we do not expect demand conditions to improve in the near term," said Fettig, Whirlpool chairman and ceo. "Our third-quarter results were negatively impacted by declining demand and record levels of cost inflation. These unfavorable factors were partially offset by improved price/mix and productivity.

"The global credit crisis has had a profound negative impact on what was already a weakening and very fragile global economy. Declining home values, rising unemployment and very low consumer confidence levels will likely prolong a negative demand environment at least through the middle of 2009."