Toledo, OH-based truck component manufacturer Dana Corp. said today it will eliminate 11,250 jobs, or 15% of its workforce, and attempt to sell Dana Commercial Credit Corp. because of slowing North American car and truck production.
"While global economic conditions had already shown signs of weakening, given the events following September 11, we now face the prospect of a further significant decline in our markets," said Dana chairman & CEO Joe Magliochetti. "These extraordinary circumstances necessitate extraordinary actions to secure the long-term competitive position of the company."
The job reductions will reduce earnings by $400 million to $450 million after taxes, mostly in the fourth quarter, company spokesman Gary Corrigan said. Corrigan added that Dana is considering the closing or combination of about 30 locations. Dana announced today its third-quarter net income fell 55% as the industry reduced heavy-truck output because of a glut of used trucks. Increased security at U.S. borders after the terrorist attacks also disrupted deliveries to plants.
Dana's net income fell to $13 million from $29 million in the year-earlier quarter. Revenue declined 14% to $2.50 billion from $2.92 billion. The company had already eliminated 10,000 jobs since June of last year, and has 75,000 employees after today’s cuts.
"Dana and its people have weathered severe market conditions in the past," Magliochetti added. "As consumer confidence returns and our markets recover, we will be well-positioned as a technology-driven, market leader serving domestic, transplant, and international customers. I am confident that we will emerge from the current situation a stronger, more competitive company better positioned for an upturn."