As part of a cost savings program designed to offset falling sales around the world, global chemical company E.I. du Pont slashed its earnings forecast and announced 1,500 job cuts.
The Delaware-based company’s sales fell 9 per cent to US$7.4 billion, below analysts’ average forecast of US$8.15 billion.
The 1,500 job cuts will leave DuPont with a global workforce of about 57,500, down from about 79,000 at the end of 2002.
The company plans to save about US$230 million by eliminating corporate costs supporting the auto paint unit, and US$220 million will come from restructuring actions related to weak global economies.
Ellen Kullman, DuPont chief executive, said weaker than expected demand in titanium dioxide (Ti02) and photovoltaic markets contributed to the decline in earnings. “We are addressing these challenges now to position ourselves for improved performance,” she said in a statement.
The job cuts will be spread across DuPont’s global operations, including reductions to the corporate services backing its performance coatings business supplying paints for carmakers.
Despite the softening Ti02 market, DuPont will continue to expand its capacity to produce the chemical in 2013 and 2014, Kullman said. “We take a long-term view on the Ti02 industry, and the industry fundamentals are solid,” she said. “Short term, there’s always going to be some puts and takes, because it is a cyclical chemical.”