Benton Harbor, MI — Whirlpool Corp. said last month that it will cut about 5,000 jobs by the end of 2009 because of the global credit crisis and its expectation for continued reduced appliance demand in North America and Europe.
The appliance manufacturer also reported that its earnings fell 7% during the company’s fiscal third quarter on lower global unit volumes and higher material costs.
“The global credit crisis has had a profound negative impact on what was already a weakening and very fragile global economy,” Whirlpool CEO Jeff Fettig said. “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.”
The Benton Harbor, MI-based company earned $163 million for the quarter, compared with $175 million a year earlier. Revenue for the three-month period, which ended Sept. 30, edged up to $4.9 billion from $4.8 billion.
Whirlpool said the drop in profit reflects significantly higher material and oil-related costs and lower industry demand. U.S. industry unit shipments of major appliances declined 11% in the quarter.
The job cuts include positions being eliminated from plant closings that the company already announced this year, along with new reductions taking place now and through the end of next year, company officials said, adding that the cuts are expected to produce annual savings of $275 million.
Whirlpool, whose brands include Maytag, KitchenAid and Jenn-Air, has approximately 73,000 employees worldwide.