Delphi Automotive Systems Corp. has announced it will eliminate 11,500 jobs, or about 5.4% of its workforce as part of a reorganizing plan involving exiting businesses and closing product lines with $900 million in annual sales.
The company expects to eliminate the jobs through voluntary and early retirement, social plan programs in Europe and normal retirements. According to company spokesman Steve Gaut, about 5% of Delphi's workers retire each year.
The Troy, Mich.-based company, said it plans to sell or close nine plants in Alabama, Arizona and Michigan as well as in Brazil, France, Germany, Italy and the U.K. The latest job plan includes 5,600, or about 10%, of its hourly workers in the U.S., as well as 2,000 U.S. salaried employees.
The company expects the reorganization to boost profits by $300 million annually by 2003.
The company will take a $400 million charge in the first quarter, and has reduced its outlook for the quarter's results to range from break-even to a loss of about $50 million.